Credova Blog

Dispelling Myths About Alternative Financing Options

Written by Emily Paul | Mar 18, 2021 9:57:01 PM

Dispelling Myths About Alternative Financing Options

You don’t know what you don’t know. You also can’t lose what you don’t have. Or can you?

Does your business offer alternative financing options to its customers? If not, you’re missing out — on potential consumers who expect such payment flexibility, on building deeper relationships with current customers, and on establishing yourself as a proactive brand that puts people above all else. The solution is simple, just like the product: Join forces with the best alternative financing platform and watch your sales increase. Still skittish? Let’s learn more about what makes Credova so special.

Straightening the Record

Retailers have a few misconceptions when it comes to point-of-sale financing. Let’s take a look at a few of the most common misconceptions surrounding alternative lending:

  • Only those with terrible credit and have been rejected by banks apply to alternative lenders.
  • Alternative loan seekers are desperate.
  • Borrowing from an alternative lender hurts the credit score.
  • High margins are necessary to make alternative loans work.
  • Alternative lending is unregulated.
  • Integrating an application programming interface, or API, is costly, difficult, and too time-consuming. As such, it requires hiring a developer to do.

Thankfully, the above points are far from the truth about point-of-sale consumer financing. Let’s explore.

Alternative lending opens up financing options for people with less-than-great credit, sure, but it also provides consumers who have perfect credit with very attractive financing terms. Folks across the credit spectrum utilize Credova to make smarter purchases. It’s never out of desperation — it’s simply a better way to pay.


The Importance of Consumer Finance

We sympathize with merchants that don’t believe their customers want a financing option or possibly don’t need to offer one because they have a more affluent customer base. Again, everyone benefits from the financial flexibility that point-of-sale offers.

To understand and know your customers is the job of any merchant. Perceiving and meeting consumers’ needs is at the very core of running any business successfully. But sometimes, even as attuned as retailers can be, they miss the mark. Recently, Business Insider published a report with overwhelming statistics that indicate consumer financing is in major consumer demand, with 76% of respondents saying they are more likely to select a merchant that offers financing over one that does not. So even if merchants think their customers won’t want financing, market research indicates the opposite to be true.

In recent years, point-of-sale financing has started to become the norm. Several years ago, offering financing to your customers may have given you a competitive edge; today, it’s how you stay in the game. Consider refusing to adopt credit card acceptance back in the 1980s. It’s almost unthinkable now to not accept credit cards. Just as cash-only businesses suffered losses by not adopting credit card acceptance, we are now in an era when we see consumer behaviors shifting to preferring merchants that offer alternative financing.

The Ease of Alternative Financing Options

In regard to integrating an API, it’s not as difficult as you may fear. If you can download an app on your phone, you can integrate an API. With major e-commerce platforms offering plug-ins designed to “plug and play” into a merchant’s website, integrating a consumer financing option is now very simple. Shopify, WooCommerce, 3DCart, Magento, Square — are all e-commerce platforms with current or under-development Credova point-of-sale financing plug-ins, to name a few.

Credova has a team of in-house developers who work with merchants from start to finish during the integration process. Every merchant has access to an account manager who acts as a liaison between their team and ours, so that every question and concern is addressed.

Now you know what you didn’t know before. Don’t lose out because you don’t offer the flexibility of alternative financing. Join forces with Credova today.

 

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