There is a growing trend in online and brick and mortar retail toward consumer financing for purchases, large and small. This creates massive opportunity and revenue potential for point of sale lending, and even for non-lending product manufacturers and retailers looking to uncover additional opportunities, and gain customers that may otherwise have been lost. Apparel, gifts, home improvement, healthcare, and even vacations are all experiencing a shift in consumer spending behavior, in which consumers-turned-borrowers are looking for flexibility in payment to maintain household (or business) cashflow, while still receiving a high-end experience, product, or service.
If you’re already set up as a lending institution, adding another product certainly has its challenges, but if you’re a non-lending product or service organization, where do you even begin?
When You Don’t Know What You Don’t Know About Point of Sale Lending, Start with What You Know
While we don’t often break that “fourth-wall” in this magical world of lending insights, let’s make a quick exception to that. Odds are, if you’re reading this, you’ve had some internal discussions and planning surrounding the onboarding of a retail or point of sale lending product, and you’re gathering information and even looking for software and consulting partners, so—good news!—you’re in the right place.
Whether you are an established lending organization or a product manufacturer, there is a lot to know about the world of point of sale lending, and it’s never too early to reach out to a knowledgeable technology implementation partner. Though, the team at FNI is more than tech implementation. Made up of technical consultants, business process experts, and leaders in finance, the FNI team takes a consultative approach to point of sale lending, no matter where you are in the process.
Since around 75 percent of consumers who finance large-ticket purchases will decide to do so early in the purchase journey, working with a point of sale lending technology partner early in your implementation journey can help to design a seamless transition that gets to your customers (and future borrowers) where they are.
So, where do you begin? Start conversations with lending partners now.
Growing a Team (or not) to Support a New Lending Product
If you’re launching a new point of sale lending product within your organization, what does that look like for your bottom line? Traditional lending organizations have teams of underwriters, customer support specialists and the list goes on. How does an organization like yours scale quickly and effectively, without massive structural changes? Well, it’s easy, you don’t scale.
Entertain the idea of a minimum viable approach to onboarding a lending process. Do you have a CFO or finance leader on the team? Or, are you able to spend just a little bit of time in getting this thing up and running? Thanks to advancements in artificial intelligence and automation, it’s certainly possible to have a “set it and forget it” lending style, with just a few check-ins and touchpoints to establish a workflow and review reports, just like you would at regular bookkeeping intervals.
Modern Lending Technology and Automation
Scaling up can seem daunting when onboarding a new lending product or creating an entirely new lending arm, but since we’ve covered that scaling a team is not the only way to make this happen, let’s talk about how. Modern lending technology allows our lending partners to create workflows and set rules that guide the process without human intervention.
While you could oversee every single financing application and have a team of underwriters, maybe get started with automated rules-based decisioning and let your new lending product run itself. The FNI DecisionCore point of sale loan decisioning platform allows for complex workflows to be established that can help new and tenured point of sale lenders mitigate risk, break down barriers, and share data across organizational departments.
Ready to create a faster, more intelligent point of sale lending platform? Start with the suite of lending products and trusted team at Financial Network, Inc. Take a no-commitment product tour today to get started.
While we keep an eye on what’s coming next, and continue to stay educated and prepared to push the fintech industry forward, the loan origination software experts at FNI will keep providing insights and, of course, providing hands-on and high-level service to our loan origination platform partners. If you’re ready for direct access to decision strategy management and more, talk to a loan origination expert.
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