In-store financing

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What is in-store finance?

In-store financing refers to a retail finance option offered directly by merchants at physical retail locations, enabling customers to make purchases and access finance solutions during their in-store shopping experience. This financing method provides consumers with the flexibility to spread the cost of their purchases over time, often through installment loans or other financing arrangements, such as revolving lines of credit, BNPL, lease-to-own, or B2B financing for business customers. In-store finance aims to enhance the purchasing power of customers and foster loyalty by integrating financial options directly within the brick-and-mortar retail environment.

Key elements of in-store financing:

  • On-site application process: In-store financing involves an application process that takes place within the physical store. Customers can apply for financing at different points of sale within the store, for example, at staffed and self-check-out, on tablets, or through QR codes linking to personal mobile devices streamlining the transaction process.
  • Immediate approval: The financing approval process in in-store finance is designed for immediacy, allowing customers to receive approval decisions promptly.
  • Flexible payment plans: Merchants offering in-store financing typically provide flexible payment plans, such as installment options, allowing customers to pay for their purchases over a predetermined period.

Application of in-store financing in retail:

  • Enhanced shopping experience: In-store finance contributes to an enhanced shopping experience by providing customers with immediate access to financing options, enabling them to make desired purchases without delay.
  • Increased sales opportunities: Merchants offering in-store financing can capitalize on increased sales opportunities, as customers may be more inclined to make larger or additional purchases when provided with flexible payment options.

Benefits of in-store finance:

  • Customer convenience: In-store finance enhances customer convenience by eliminating the need to seek external financing. Customers can complete the financing process seamlessly as part of their in-store shopping journey.
  • Brand loyalty: Offering in-store financing can contribute to increased brand loyalty, as customers appreciate the convenience and financial flexibility provided by the retailer.
  • Quick decision-making: The immediate approval process associated with in-store finance facilitates quick decision-making for customers, fostering a positive and efficient shopping experience.

In-store financing integrates financial options directly into the retail environment, providing customers with on-the-spot financing solutions and contributing to an enhanced shopping experience at physical stores.

Installment loans

What is an installment loan?

An installment loan is a structured loan that allows customers to pay for a purchase over time through a series of fixed, scheduled payments, or installments. Installment loans can be an attractive way for customers to pay for a purchase in small manageable amounts. Interest rates can vary according to the repayment timeline, with longer term loans having higher interest rates. Installment loans can be integrated into the merchants’ sales point-of-sale financing process, providing flexibility for customers to spread the cost of their purchases.

Key features:

  • Checkout integration: Merchants can integrate installment loans into their point-of-sale financing process, allowing customers to select this option when making a purchase.
  • Fixed payment structure: Customers receive a clear and predictable payment structure with clear terms.

Benefits for merchants:

  • Increased average transaction value: Offering installment loans can lead to higher average transaction values, as customers may be more inclined to make larger purchases when they can spread the cost.
  • Competitive differentiation: Merchants can differentiate themselves from competitors by providing flexible point-of-sale financing options, attracting customers seeking affordability.
  • Enhanced customer loyalty: The availability of installment loans can foster customer loyalty, encouraging repeat business and positive reviews.
  • Boost in conversion rates: A more flexible point-of-sale financing structure can contribute to increased conversion rates, as customers are more likely to complete transactions when given payment flexibility.

Considerations for merchants:

  • Integration effort: Merchants should assess the effort required to integrate installment loans into their existing point-of-sale financing systems, ensuring a seamless and user-friendly experience.
  • Communication strategies: Clear communication about the availability of installment loans and their benefits can enhance customer awareness and utilization.