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Understanding Point Of Sale Financing — A Trillion Dollar Industry

Are you a merchant afraid to face the retail industry f-word—financing? Hopefully not! What some merchants don’t realize is the substantial customer base they forfeit if they don’t provide financing options.

The tough fact is this: subprime customers exist – lots of them! In fact, 100 million US consumers have a credit score lower than 700. The growing need of financially challenged families and credit-card averse millennials has led to a new segment of the fintech industry – one that caters specifically to helping those who are cut off from the credit world. Technology has helped solve the issue of “bad credit, no credit.” Now essentially any family or individual with a job and bank account can get approved immediately to buy the things they need – essential things like tires, mattresses or refrigerators – right at the point of sale.

How big is this point-of-sale finance market? One trillion dollars, according to leading fintech champion LendIT USA, who dedicated a panel on the topic at their March 2017 conference. By servicing retailers from 2013 to 2016, Acima Credit alone has grown 9,000 percent.

Many merchants are reluctant to provide lease-to-own at the point of sale because of preconceived notions of the industry. Sure, the ability to “rent-to-own” has been around a long time, but improved technology and machine learning have changed the industry significantly in recent years.

Let’s take a look at some of the ways merchants can provide an improved user experience and buying power while saving the sale.

Benefits for Merchants:

Timeliness and Conversion

As recent as a dozen years ago if a customer wanted retail financing, they would have to go to a separate location, fill out a pen and paper application, and discuss their debt and income ratio for qualification. They then would wait for one to two days for approval. This process was an annoyance for merchants and customers and threw a wrench in the sales process. Today, it takes five minutes or less for an analytics engine to quickly identify and approve applicants.

Zero Merchant Fee

With Acima, it costs the merchant nothing to sign a new customer.


Retailers expand their customer reach and following by having a 90-day purchase option (3-months in CA). Once customers pay off the lease, Acima continues marketing to them – on behalf of the merchant –to bring them back to the store for future purchases.

Positive User Experience

Acima provides the customer with several early purchase options and incentives. This includes a tailored payment schedule designed to match the customer’s payroll dates.

Acima provides the merchant with a portal that is easily accessed online. The simple dashboard creates leases, tracks the status of customer approvals, funding amounts, and other reports.

Though no credit needed leasing has been around, technology has taken it to another level, helping retailers right at the point of sale to offer options to subprime customers that were previously unreachable.