How do I get financing for my customers
Friday July 2nd, 2021
For business owners new to finance, partnering with Duologi grants access to a range of bespoke, highly flexible payment plans tailored to your customers’ needs. Our solutions are designed to fit seamlessly with your current payment systems and online platforms, with repayments managed entirely by us on your behalf.
At Duologi, ‘how do I get financing for my customers?’ is among the most frequent questions we field from owners of new and growing businesses. In fact, it’s often one of the first things we’re asked by clients at a wide range of online retail and service-based SMEs.
With that in mind, here’s a quick run-down of the most common talking points we tend to end up covering when someone asks us about setting up customer financing at their business.
What is customer financing?
Firstly, let’s define exactly what we’re talking about when we say ‘customer financing’. Retail finance solutions from Duologi are a customer-focused, tech-forward way to provide your valued clients and buyers with a range of flexible short- and long-term payment plan options, administered by us on your company’s behalf.
It’s not only online retail businesses that can benefit from partnership with Duologi: we also specialise in finance solutions for companies operating in various other sectors, including healthcare, education and legal.
Does Duologi financing affect cash flow into your business?
Not at all. Because we manage your buyers’ repayment plans directly with the individual customers themselves, there’s no additional admin for you to worry about, and no impact on your day-to-day cash flow.
Your company still receives payment up front as normal (i.e. at the time a purchase is made) for all goods, products or services supplied. The customer then settles their outstanding balance directly with us more gradually, spreading repayments across the duration of their Duologi financing agreement.
How to offer financing to customers
To begin with, talk to us. Here at Duologi, we pride ourselves on taking the time to really understand our client companies, building the best customer finance solutions to help power sustainable business growth in line with your own unique set of aims, methods, customer needs, and long-term aspirations.
Applying for and setting up customer finance with Duologi is simple in terms of the core requirements and (largely digital!) ‘paperwork’. Our expert team can help guide you through the straightforward process in a matter of minutes, and you’ll be up and running in no time.
Once you’ve decided on the ideal set of flexible payment solutions for your business and customers, we’ll even help ensure they’re clearly signposted across all your online/offline points of sale. We provide all Duologi partners with various physical and digital marketing materials, designed in-house by our resident PR gurus, to help you highlight the full range of financing options available for new and returning buyers alike.
Legal implications of customer finance
As a fully FCA-certified finance partner, our duty as a responsible lender is an absolute priority at all times. In short, our job at Duologi is to build customer finance solutions that work with your specific business – but, crucially, to a plan that also reflects the individual needs and circumstances of your buyers.
We’re backed by Oaktree Capital, one of the largest investment management firms on the planet, and we insist on completely transparent operation at all times. Our entire approach is based around serving the needs of customers – both ours and yours – and our team of money management specialists draws on decades of frontline experience in the finance, technology, marketing and data analysis industries.
You can read about our guiding principles, policies and business ethics in our dedicated article on Why Responsible Lending Matters. For more information about the legal implications of customer finance – and about how Duologi ensures full compliance with all FCA/OFT Consumer Credit License guidelines – check out our guide to The Facts About Customer Financing.
Types of finance available
There are a variety of customer financing models available through Duologi, as well as the potential to have your own bespoke hybrid model created for you to suit the precise needs of your business, customers and cash flow.
Our core options include ever-popular packages like 0% Finance and Buy Now, Pay Later formats, as well as interest-bearing finance and multi-tier options if they’re better suited to the type of goods retail or service you provide.
Interest payment in customer finance – the flexible Duologi model
Practically all customer finance packages involve some form of subsidy payments, and ours are no exception. It’s effectively our ‘share’ as your financial partner, in return for providing the financing arrangements, and managing all ongoing payment plans with your customers.
Subsidy costs can differ slightly depending on the type(s) of payment plan you choose to offer, but they’re typically tied to the interest payments on a buyer loan. At Duologi, we’ve deliberately designed this element to be highly flexible in terms of where it’s sourced from, letting you decide how every aspect of your company’s financing model is structured.
In simple terms, loan interest can either be passed directly on to your customers in the form of higher repayment totals, or you can choose to subsidise the cost of 0% credit options yourself. Passing them on typically means your margins are protected, but the overall package becomes slightly less appealing to buyers. Alternatively, absorbing interest costs into your own budget will slightly reduce your maximum profit per transaction, but is likely to increase customer take-up of finance options at checkout.
What are the benefits of financing?
A few of the key benefits of financing include:
- Increased sales. The availability of hassle-free payment plans can help customers enjoy a far greater sense of empowerment, freedom, and financial autonomy. This in turn leads directly to freer spending without introducing undue risk to the buyer, and also gives you a clear advantage over competing businesses for customers at the consideration stage.
- Eliminating common buyer concerns around the impact of one-off large payments gives your customers the confidence to purchase bigger ticket items more readily. This makes visitor-buyer conversions far more likely, in part by greatly reducing the risk of anxiety-related shopping cart abandonment before a sale is successfully completed.
- Offering retail finance solutions is also a proven method for increasing AOV (average order value) per transaction. Again, customers backed by financing options are less likely to suffer a crisis of confidence as their basket total grows, giving you a much better chance of successfully bundling or upselling additional products and services.
- Improved customer retention rates over time. Statistics clearly show that a positive experience with customer financing can be a powerful factor in drawing customers back to the same seller or service provider in future; in fact, up to 78% of people are more likely to return to a retailer who offers flexible payment plans.
- Improved perception of your brand among both current and prospective customers. Offering a range of payment solutions helps make your business look more professional, customer-focused, and financially robust. In sectors like healthcare finance, where word of mouth remains a uniquely powerful PR tool, this can lead to increased referrals and help build a loyal user base for years to come.
Read more about the potential benefits of retail finance in our dedicated piece on The Value Of Offering Payment Plans For UK Customers.
Want to start offering finance to customers?
If you’d like to learn more about the specifics of how financing works at Duologi, feel free to contact a member of our team at any time. We’re always happy to chat without obligation about your business needs for the future and to demonstrate how our tech-forward, customer-first finance packages would slot in seamlessly with your existing online retail systems and sales platforms.