Credit is now available for customers’ online purchases and the process has all the benefits of in-store finance
Credit options for shoppers have long been available in stores, but Pay4Later is a new retail finance firm that brings this process to the internet.
It works by allowing online retailers to offer an interest-free credit option at the point of sale. Customers can choose the option at the checkout and then complete an online form with a check box to tick in order to ‘sign’ the agreement. This form is then transmitted to the lender to credit check (Pay4Later states that this will take between five and 10 seconds) and, if accepted, the customer is then required to pay a small deposit on the product (typically 10%) and can then complete the transaction.
If the customers fails the credit check, the retailer is informed and they can then follow up on it as they see fit.
Pay4Later works in partnership with lender Secure Trust Bank but is looking to expand its number of lender partners, giving retailers an extensive choice of lenders to work with. The company facilitates the relationship between retailer and lender and gives instructions on how to integrate the system.
Unlike in-store credit options that are usually settled by the lender to the retailer within 24 hours, Pay4Later takes longer, with most transactions settled within 14 days of purchase.
Even so, it means retailers can offer different payment methods to attract new customers and make their product offer more accessible and affordable to a larger audience.
Pay4Later says the system can be integrated with current payment models and can deal with a large number of transactions. It currently offers a standard or corporate account option, depending on the size of the business and how bespoke the retailer would like the process to be. Offering credit in store has long been seen as a way to increase sales and although Pay4Later has yet to link up with any fashion retailers, it believes that bringing this option online can only have the same result.