Retail finance - Working with a finance provider
Discussion
Bit of a peculiar one..
I currently offer finance on my products via Omni finance, the customer can spread the cost over 12 - 60 months, the APR in most cases is 19% which isn't great and I know that but we sell products substantially below RRP and there just isn't the margin for 0%, they take approx 10-15% of the loan amount where as 19% APR we get the full amount.
Anyway finance generates about £80k worth of sales per annum and its not something we want to lose but it got me thinking is there a better way of doing this?
My question is, could I work with a finance provider such as Zopa who dont specifically offer retail finance so have better rates?
For example, a customer checks out on our website and wants to spread the cost, we link them to Zopa or a member of their team who can possibly offer a slight better rate or some incentive considering we would be passing work to them. The customer gets a better rate, Zopa get more business & we get the full amount. It also gives the customer to have a no deposit finance where we require 10% minimum (usually around £300).
Having quickly checked the difference in price, doing the above option rather than going through us/Omni is £20 per month cheaper on a £3000 loan over 5 years.
It could (I think) also take some pressure off us in terms of the FCA and reporting etc.
I currently offer finance on my products via Omni finance, the customer can spread the cost over 12 - 60 months, the APR in most cases is 19% which isn't great and I know that but we sell products substantially below RRP and there just isn't the margin for 0%, they take approx 10-15% of the loan amount where as 19% APR we get the full amount.
Anyway finance generates about £80k worth of sales per annum and its not something we want to lose but it got me thinking is there a better way of doing this?
My question is, could I work with a finance provider such as Zopa who dont specifically offer retail finance so have better rates?
For example, a customer checks out on our website and wants to spread the cost, we link them to Zopa or a member of their team who can possibly offer a slight better rate or some incentive considering we would be passing work to them. The customer gets a better rate, Zopa get more business & we get the full amount. It also gives the customer to have a no deposit finance where we require 10% minimum (usually around £300).
Having quickly checked the difference in price, doing the above option rather than going through us/Omni is £20 per month cheaper on a £3000 loan over 5 years.
It could (I think) also take some pressure off us in terms of the FCA and reporting etc.
Hi mate
Just thought I'd drop you a note - my wife is a self employed finance broker, contracting with an asset finance brokerage. Being a brokerage they have the ability to approach a diverse range of funders and therefore can offer finance at most levels and rates.
They may or may not be able to help your situation but I thought it'd be worth a chat to at least qualify in or out. Let me know if you are interested and I'll drop her details!
Thanks
Dan
Just thought I'd drop you a note - my wife is a self employed finance broker, contracting with an asset finance brokerage. Being a brokerage they have the ability to approach a diverse range of funders and therefore can offer finance at most levels and rates.
They may or may not be able to help your situation but I thought it'd be worth a chat to at least qualify in or out. Let me know if you are interested and I'll drop her details!
Thanks
Dan
JCKST1 said:
Bit of a peculiar one..
I currently offer finance on my products via Omni finance, the customer can spread the cost over 12 - 60 months, the APR in most cases is 19% which isn't great and I know that but we sell products substantially below RRP and there just isn't the margin for 0%, they take approx 10-15% of the loan amount where as 19% APR we get the full amount.
Anyway finance generates about £80k worth of sales per annum and its not something we want to lose but it got me thinking is there a better way of doing this?
My question is, could I work with a finance provider such as Zopa who dont specifically offer retail finance so have better rates?
For example, a customer checks out on our website and wants to spread the cost, we link them to Zopa or a member of their team who can possibly offer a slight better rate or some incentive considering we would be passing work to them. The customer gets a better rate, Zopa get more business & we get the full amount. It also gives the customer to have a no deposit finance where we require 10% minimum (usually around £300).
Having quickly checked the difference in price, doing the above option rather than going through us/Omni is £20 per month cheaper on a £3000 loan over 5 years.
It could (I think) also take some pressure off us in terms of the FCA and reporting etc.
I currently offer finance on my products via Omni finance, the customer can spread the cost over 12 - 60 months, the APR in most cases is 19% which isn't great and I know that but we sell products substantially below RRP and there just isn't the margin for 0%, they take approx 10-15% of the loan amount where as 19% APR we get the full amount.
Anyway finance generates about £80k worth of sales per annum and its not something we want to lose but it got me thinking is there a better way of doing this?
My question is, could I work with a finance provider such as Zopa who dont specifically offer retail finance so have better rates?
For example, a customer checks out on our website and wants to spread the cost, we link them to Zopa or a member of their team who can possibly offer a slight better rate or some incentive considering we would be passing work to them. The customer gets a better rate, Zopa get more business & we get the full amount. It also gives the customer to have a no deposit finance where we require 10% minimum (usually around £300).
Having quickly checked the difference in price, doing the above option rather than going through us/Omni is £20 per month cheaper on a £3000 loan over 5 years.
It could (I think) also take some pressure off us in terms of the FCA and reporting etc.
Edited by Doodlebug87 on Friday 19th May 19:28
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