UK businesses could be losing out on over £25 billion in potential sales by not offering a range of consumer finance options, according to recent research.
The findings were published in a report by specialist lending platform, Duologi, which looked at the current state of the consumer credit market and attitudes towards point-of-sale (POS) finance across a number of sectors. POS finance allows merchants – from retailers to health providers and travel companies - to offer their customers a loan to purchase a product or service.
The study, “Finding the right balance: the future of credit” revealed that more than three-quarters (78%) of consumers would consider purchasing through POS finance in the future – around 39million UK adults.
Of these, the average amount that each would be willing to borrow is £620, representing a potential £25 billion sales opportunity for merchants that implement this type of payment into their business model.
Consumer spending behaviour is also likely to favour merchants that offer POS finance options – helping to boost sales and reputation in a number of key ways.
Over a third (34%) of people said they would be more likely to spend with a business that offers POS finance options. With fierce competition throughout every sector as the UK economy fluctuates in confidence, this potential to boost traffic (both online and in-store) could be critical to a brand’s survival.
Customers also stated that POS finance options would be a key factor in deciding where to shop; 20% of people said that if a company didn’t offer flexible finance options, they would be more likely to go elsewhere.
Moreover, finance options can help to boost brand loyalty, with more than a quarter (28%) of people saying they would be more likely to return to a merchant that allowed them to borrow funds in this way.
A further 26% of people would be likely to spend more than originally planned if they found they could access a good amount of credit from a merchant.