Glossary: Consumer financing

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What is consumer financing?

Consumer financing is a financial arrangement that allows customers to purchase goods and services at the point of sale through different types of loan options. It offers an alternative to credit cards and cash. This method enables shoppers to manage their cash flow and make purchases that might otherwise be out of reach. Consumer finance encompasses a diverse set of financial products and services, including installment plans, Buy Now, Pay Later (BNPL), revolving credit, lease-to-own, and B2B financing to meet the unique needs of shoppers.

Consumer financing at the point of sale

Consumer financing at the point of sale gives shoppers access to payment options that let them spread the cost of a purchase over time. Merchants can offer these options across any channel—online, in-store, in-home, or through a call center.  

Why it matters

Spreading payments over time gives customers greater flexibility and makes larger purchases more manageable. For merchants, embedding consumer finance directly into the buying journey helps meet diverse customer needs and supports sales growth across all retail channels.

How does ChargeAfter transform consumer financing 

ChargeAfter’s embedded finance platform makes consumer financing more accessible for merchants and shoppers alike:

  1. Personalized choices – financing options matched to each customer’s credit profile

  2. Multi-lender network – a wide range of lenders increases approval odds

  3. Waterfall financing – declined applications automatically cascade to the next lender

  4. Seamless integration – works in-store, online, or via call center without disrupting sales flow

  5. Boosts sales and loyalty – flexible payments increase order values and repeat business

Multi-lender embedded finance platform: ChargeAfter connects merchants to a wide embedded lending network, increasing approval odds and making consumer finance more accessible.

What does ‘consumer financing’ mean?

“Consumer finance,” “consumer financing,” and “consumer lending” are closely related terms, often used interchangeably, but each has a different emphasis:

  • Consumer finance is the umbrella term for financial products and services for individuals rather than businesses. These include personal loans, mortgages, credit cards, auto loans, and retail financing.
  • Consumer financing typically describes arrangements that enable shoppers to pay for purchases over time. Options include installment loans, Buy Now, Pay Later (BNPL), revolving credit, and lease-to-own.
  • Consumer lending refers specifically to extending loans or credit to individuals. Examples include personal loans, personal lines of credit, and auto loans.
  • Point-of-sale (POS) financing is consumer financing offered as part of the purchasing process, whether online, in-store, or in-home. It allows shoppers to apply for financing through the merchant’s buying experience.

Frequently Asked Questions

What is consumer financing? 

Consumer financing lets shoppers spread the cost of a purchase over time, often through options offered at checkout. These may include installment loans, revolving credit, promotional financing, or lease-to-own arrangements. Giving shoppers more ways to pay can make purchases more manageable and improve sales conversion for merchants.  

What’s the difference between consumer financing and consumer lending? 

Consumer financing describes ways individuals can pay for purchases over time. Consumer lending refers specifically to the credit a lender provides, such as an installment loan or a revolving line of credit. 

What is a consumer finance account? 

A consumer finance account is an account used to manage a loan or line of credit. Depending on the product, it may show the available credit, outstanding balance, payment schedule, and transaction history. 

Is consumer financing the same as a credit card? 

A credit card is one form of consumer financing, but not all consumer financing involves a card. Other point-of-sale options include installment loans and lease-to-own arrangements. 

What industries use consumer financing? 

Consumer financing is used in industries with a high average order value. That can include home improvement and services, furniture and mattresses, consumer electronics, telecommunications, jewelry, and travel.