Benefits Of Consumer Lending Through POS Financing
What Is Consumer Financing?
Let’s say you are a consumer interested in a product or service that comes with quite a price tag that you cannot pay for upfront.
Well, this is where consumer financing comes in.
Consumer financing (also known as POS Financing or Credit Financing) provides customers a financing option that allows them to make monthly payments.
In essence, it allows the consumer to buy now pay later.
By offering Point-Of-Sale financing, customers find the purchase more affordable.Therefore, in return, it increases sales and boosts customer satisfaction
But, how is it beneficial to businesses and merchants offering this service?
How Does POS Finance Benefit Business?
Credit financing is designed as a win-win situation for both the consumer and businesses.
When a business offers this checkout financing option, ultimately it is opening the door for more business – and more business equals more profits.
Therefore, it allows businesses to maintain a high level of customer service and satisfaction.
More importantly, businesses can better focus their attention on the sale of their products.
From a consumer’s perspective, it may lift what may be a heavy financial burden, especially if a purchase is necessary.
For example, in the funeral care industry, consumer financing is a popular choice.
Dealing with the death of a loved one is devastating in itself, and sadly funerals are costly.
In such cases, consumer financing lifts the financial burden off of the family.
At the same time, the funeral organizers can arrange a lovely send off for the sake of the family and their loved one.
How Does It Benefit Merchants Who Offer This Service?
Many benefits come by offering consumer financing.
Consumer financing is a great option for businesses of all sizes.
Here are a few reasons why…
Boosts Sales
Offering a consumer finance option may turn a browsing customer into a paying one by making your product affordable. As a result, this increases sales and conversion rates.
Builds Customer Loyalty
Consumers love a company that has excellent customer service. Building customer loyalty is essential for any business regardless of size, niche, and market.
Consumer financing helps to build trust between a business and its customers.
And the more trust and loyalty the consumer feels, the more likely they are to make a repeat purchase.
Fast Approval
If a customer is in need to make a quick purchase, they are most definitely not looking for lengthy applications and a long wait for approval.
By providing quick applications and fast approval rates, they are more likely to make a purchase.
Good consumer financing solutions provide approval in seconds. Fast transactions increase customer satisfaction and reduce unnecessary burden on the merchant’s the site.
The most efficient consumer financing solutions provider as of 2020 is ChargeAfter.com
Increases Average Spend
When you offer consumer financing, it increases the customer’s average spend.
Why?
Well, with consumer financing you can provide incentives and special offers to customers.
For example, you could tell the customer that if they kept up with payments, you could reduce the interest rate over time.
Low Risk
Building a solid foundation with a reputable lender helps lower the risk both for your business and your customers. Some lenders will also provide you with insurance coverage as an additional form of protection. Although this is optional, it may be worth it in the long run as customers are more likely to leave positive reviews and feedback.
Final Thoughts
When you go the extra mile for your customers, it does not go unnoticed.
According to research, many customers said they would not have made a purchase had the consumer financing option not been available.
All businesses, whether large or small, face the same challenges when it comes to trying to increase sales, conversion rates, and customer loyalty.
Keeping track of what the customer is buying and why is key for the growth of any business.
Offering your customers flexible financing options may give you the competitive edge you need to boost your sales and increase brand awareness that will set you apart from your competitors.
Ultimately, POS financing has proven to be both effective and practical. It gives flexibility to the customer to be able to make a purchase they otherwise would not have been able to with an upfront payment.
Consumer financing poses many advantages for all types of businesses and niches, allowing you to build your brand, grow your customer base, and having a thriving and reputable business.