In the competitive world of e-commerce, offering consumer-friendly financing options can be the difference between making a sale or losing customers to a competitor. For online merchants, understanding and implementing the best financing terms is not just a service—it’s a strategic move.
That said, it’s no secret that Buy Now Pay Later (BNPL) solutions are an advantageous proposition. Market leaders like Shopify, Magento, WooCommerce, BigCommerce, and PrestaShop have largely depended on integrated finance companies such as Affirm, Klarna, and PayPal to offer these services. However, do these fintech players truly deliver the best terms for their e-commerce clients?
The answer may surprise you.
The Limitation of Traditional Third-party Integrations
Conventionally, online merchants have been constrained by the financing companies that are readily integrated with these third-party shopping carts. This often-meant slim pickings when it came to finding a BNPL partner that offered both an easy setup and the most advantageous terms for their customers. This scarcity of fitting financing solutions can directly impact the shoppers’ experience. It can lead to increased cart abandonment rates and lower average order values, as potential buyers might not find suitable payment plans to match their financial needs. Without the presence of a versatile BNPL partner, retailers are unable to cater to the varying financial capabilities of a wide array of visitors to their online store, consequently missing out on a significant portion of sales.
In short, the third-party integration bottleneck has left a gap in the market—a gap where online shopkeepers and their clientele could genuinely benefit from a more beneficial financing partnership. This is because popular Fintech players like Affirm, Klarna, and PayPal have been the go-to solutions due to their ease of integration with leading shopping carts. But this convenience often comes at a cost: less than ideal financing terms for merchants and customers.
Financial Backing: How It Shapes Consumer Financing?
Fintech lenders depend on capital from private equity groups, facing high borrowing costs that lead to elevated interest rates, sometimes soaring up to 36%. This high cost of borrowing, packaged with additional expenses such as billing, service, risk management, and loss default, creates a domino effect. When defaults rise, fintech lenders have little choice but to balance their books by increasing merchant fees and tightening their underwriting models resulting in lower conversion.
Contrastingly, banks have the privilege of borrowing from the Federal Reserve at more favorable rates, thus offering them the flexibility to craft nuanced loan programs. With longstanding infrastructures, they bypass many of the overheads their fintech challengers face. Internal billing, service operations, and rich datasets for risk management empower banks to finely assess a customer’s likelihood of defaulting.
Such insights and lower borrowing costs mean traditional lenders are not pressed into a “one-size-fits-all” approach. This has a direct, positive bearing on the terms of financing they can provide — from loan size to APRs — which can foster increased purchase sizes and minimize cart abandonment.
The Power of Better Terms
Why do these distinctions matter for consumers and merchants alike? When fintech limitations narrow financing choices, customers may balk at higher costs or inflexible terms, leading to higher cart abandonment rates. Smaller purchases become the norm as buyers stray from cost-prohibitive financing.
In contrast, the accommodating terms offered by traditional financial institutions support a more seamless Buy Now Pay Later experience. Consumers are offered advantageous loan options, enhancing their purchasing power, and encouraging larger basket sizes. This generally improves sales metrics for merchants who partner with such institutions, reducing the woes of cart abandonment and fostering customer loyalty.
Traditional lenders invest in financial products as well as deeply understand innate purchasing behaviors. Their comprehensive approach ensures that both merchants and consumers benefit from point-of-sale financing solutions that are as comfortable as they are cost-effective.
What does this mean for you as a merchant? Updating online financing strategies to incorporate the strengths of traditional lending institutions can be a turning point for consumer satisfaction and business growth. Elevating the standard in this way aligns with the core values of BNPL and ensures that the best financing opportunities are not just available but genuinely drive the market forward.
Traditional Lenders vs. Fintech Financing Players
For a side-by-side look, conventional lenders operate with an extensive history of providing credit. These institutions have developed stringent but fair practices to evaluate creditworthiness, allowing them to offer a spectrum of financing terms tailored to a wide range of customers. On the other hand, fintech companies, although innovative and disruptive, may apply a one-size-fits-all approach that doesn’t always align with every customer’s financial situation.
So, why consider banks, credit unions, and specialty finance companies as viable alternatives? It boils down to what they offer – potentially lower interest rates, favorable repayment conditions, and personalized service. While FinTech options make Point of Sale Financing convenient, they often don’t match the credit advantages that established financial institutions can provide to consumers. It’s a classic case of newer players versus the tried and tested, with the latter often coming out on top in terms of benefits for customers’ long-term financial health.
WeGetFinancing: A Bridge to Better Consumer Financing
Imagine a scenario where banks, credit unions, and specialty finance companies become directly accessible to eCommerce businesses. That’s where WeGetFinancing comes into play.
With the introduction of WeGetFinancing plugins compatible with platforms like Shopify, Magento, WooCommerce, and BigCommerce, merchants now have the unprecedented ability to provide their customers with superior point of sale financing options.
- Streamlined Application Process: Say goodbye to lengthy and complex credit applications. WeGetFinancing facilitates quick, real-time credit decisions, enabling instant gratification for your customers.
- Tailored Financing Solutions: Each customer’s credit profile is taken into account to match them with the best financing terms, providing a personalized shopping experience.
- Integration with Leading E-commerce Platforms: WeGetFinancing has created plugins that work cohesively with top shopping carts, ensuring you can plug and play their services without disrupting your operations.
- Adaptability to Business Needs: Whatever your business model, WeGetFinancing molds its services to match your unique requirements, providing the BNPL and best financing solutions.
- A Network of Reputable Conventional Lenders: WeGetFinancing brings traditional and trusted financing options into the BNPL space, connecting customers with various conventional lenders.
- Enhance Customer Trust and Conversion: Offering financing from respected institutions can boost your brand’s credibility and enhance customer trust, translating to higher conversion rates.
- Competitive Edge: By having the best financing terms compared to typical FinTech solutions, you stand out in the e-commerce space, enticing new customers and retaining existing ones.
In other words, WeGetFinancing acts as an intermediary platform, connecting consumers with a multitude of lenders during the checkout process. In addition, WeGetFinancing has made strides in integrating with major e-commerce platforms through its plugins.
According to a recent market analysis, offering multiple financing options can increase e-commerce conversion rates by up to 20%. WeGetFinancing’s efforts align perfectly with this data point — to enrich the financing choices for consumers and help merchants capitalize on every potential sale.
The WeGetFinancing Advantage
WeGetFinancing marries the convenience of modern BNPL services with the robustness of conventional banking. As mentioned above, WeGetFinancing works by creating a suite of conventional lenders—banks, credit unions, and specialty finance companies—that inherently come with the pedigree to offer superior financing terms to consumers.
For E-commerce Merchants
By integrating WeGetFinancing, Shopify, Adobe Commerce (Magento), WooCommerce, and BigCommerce merchants can now extend a competitive advantage in Consumer Financing for Online Shopping. The platform ensures that regardless of a customer’s credit profile, they are presented with the best financing terms available. This not only increases the likelihood of purchase conversion but enhances customer satisfaction with terms tailored to their financial status.
For Consumers
Consumers stand to benefit from a diversified network of lending partnerships that WeGetFinancing cultivates. Instead of a one-size-fits-all approach, shoppers receive personalized offers that resonate with their creditworthiness in a matter of seconds. WeGetFinancing’s dynamic system assures that each consumer’s financing solution is tailored to their unique situation, broadening the accessibility of BNPL options beyond what fintech companies typically provide.
Breaking Down the Integration
The WeGetFinancing plugins ensure seamless operation with your existing shopping cart ecosystem, making setup hassle-free. In short, WeGetFinancing plugins seamlessly integrate with your e-commerce platform, ensuring the transition to better financing terms is both effortless and straightforward.
- Easy Installation – For online retailers already using established shopping carts, adopting WeGetFinancing comes without the headache of revamping their payment systems. Its plugins are designed to fit into the existing framework, reducing the burden on the merchant’s technical resources.
- Comprehensive Financing Suite – Upon setting up with WeGetFinancing, the merchant is introduced to various lenders. This network not only enriches the available ‘Point of Sale Financing’ options but also ensures that clients walking into the virtual store find a financing plan that’s just right for them.
- Data-Driven Matching – Using sophisticated algorithms, WeGetFinancing matches consumers with the lender most likely to offer them advantageous terms. This data-driven approach maximizes the efficiency of the financing process, minimizes the risk of credit rejections, and facilitates higher conversion rates for the merchant.
Support teams are readily available to assist through the integration process, ensuring that your digital storefront can quickly start benefiting from the added value of mainstream consumer financing conditions.
Conclusion: The New Age of Point-of-Sale Financing
Why should merchants settle for less, and why should consumers pay more when there’s a better way? It’s time for a substantial shift in how online shopping consumer financing is perceived and implemented. Whether your goal is to elevate the shopping experience or boost conversion rates in the dynamic world of e-commerce, WeGetFinancing delivers the right solutions for your business.
In summary, the future of e-commerce lies in convenient, flexible, and accessible financing options. With WeGetFinancing, merchants can provide customers with the beneficial terms they deserve, backed by trustworthy lenders.
WeGetFinancing merges traditional lending with the innovative flair of the fintech world, offering the best financing terms and a streamlined Buy Now Pay Later experience: two notions that have been long overdue.
Remember, the wave of BNPL is only getting bigger — stay ahead of the curve and give your customers the financial flexibility they desire and the competitive edge your business needs. Click here to get started on broadening your financing options today.
