If you’ve been paying attention, you already know that BNPL, or “Buy Now Pay Later,” and Point of Sale financing are two payment options for consumers that have pushed to the forefront in recent years. Why should you care about that? And what is the difference between the two?
Here it goes. BNPL is a payment option that allows you to pay off a purchase over a short period of time without the hassle of traditional underwriting – or the ding to your credit because qualification is often based on a soft credit pull. An example of a BNPL option would be paying off a retail purchase in 4 equal payments over a couple months.
Point of Sale financing, or Point of Sale lending, is usually applicable to larger dollar purchases that are paid off over a longer period time and involves more traditional underwriting. Financing amounts can go as high as $100,000 with terms over 10 years. Point of Sale financing is an ever-increasingly popular payment method in home improvement, healthcare, and for larger ticket items like appliances, electronics, and furniture.
And why should you care about BNPL/point of sale financing? Well, if you’re interested in a fast, efficient way to finance a purchase without using your credit card, this is your answer!
Well, here is your answer – just about anywhere! The industry is booming right now, and retail merchants, home improvement contractors, and healthcare providers are clamoring to get onboard. Bolstered by online pandemic shopping and consumer demand for easy, convenient financing options, many businesses and lenders are heeding the call and either working with technology providers or developing their own in-house solutions.
We’re glad you asked! FinMkt’s SaaS platform offers both end-to-end and modularized consumer financing and loan origination technology. Empowering lenders, merchants, and enterprise partners to control their own destiny with a customized solution tailored to their unique brand. Our platform supports traditional installment loans, revolving lines of credit, deferred interest promotional offers, and no-credit-check BNPL payment options.
Well, we may not be a household name (yet..), but since 2016 we have been quietly working on groundbreaking integrations that will offer industry-disrupting financing products to consumers across the credit spectrum. The result: an omni-channel, vertical-agnostic consumer financing platform capable of swiftly implementing custom solutions for virtually any business or lender wanting to harness the power of BNPL/point of sale financing. By offering a complete off-the-shelf or modularized solution, FinMkt removes many pain points to accelerate the implementation of new or enhanced BNPL/point of sale financing solutions.
Single lender platforms only serve a fraction of consumers, leaving merchants and consumers hanging. By integrating multiple lenders into one seamless application, FinMkt has created a true full credit spectrum solution. More consumers can be approved and merchants can increase sales by providing more customers with pay over time financing options at the point of sale. Partners are able to configure lenders and products and even integrate their own financing products or lending partners.
Because FinMkt’s SaaS platform is already built to support multiple lenders and lending products, banks, credit unions, and alternative lenders alike can tap into our marketplace of lenders by integrating with us. Or, they can harness our API-driven technology to create their own, white-labeled solution – whether choosing to use our end-to-end platform or licensing out pieces of our technology separately, such as real-time borrowing decisioning or automated merchant underwriting.
The only way is up. As of now, these options are taking up a fairly small portion of the market in comparison to credit cards. However, the adoption of BNPL/point of sale financing by consumers has increased significantly, even just from 2020 to 2021. Many consumers adopting this method of payment are in younger generations. But, even Boomers seem to be getting in on the action. As the industry grows, FinMkt will be in the unique position to support a full array of financing products, lenders, and industries. Therefore, our potential is limitless!
You may have noticed more companies advertising or approaching you about offering home improvement financing at the point of sale. It seems everywhere you look, companies are offering customers new ways to finance their purchases. While point of sale lending is not necessarily new, it has seen a reemergence in popularity in recent years as newer technologies make it faster and easier. But, why should you offer this type of financing? Will it help your home improvement business? And why should you consider it if you already have a financing solution?
Debt to income ratio and credit utilization ratio; why do these two things matter and what do they mean? Both can impact what kind of loans or credit cards you are approved for, but only one will affect your credit score. Nevertheless, they are both used as indicators to creditors looking to determine whether or not you are able to take on additional financial obligations. Therefore, both of these should be taken into consideration when creating your financial plan.
Technology has dramatically changed how we shop. Not too long ago consumers could only pay cash or use a card for purchases. If you didn’t have the cash available, didn’t want to use a high-interest rate credit card, or if that card didn’t have enough available credit, you were out of luck. Today, thanks to technology, shoppers can choose an alternative financing option at the point of sale.