Consumer finance is one of the best ways for retail business owners to build stronger relationships with their customers. Whether a customer seeks out financing options from a retail business, or the retailer points them in that direction, the benefits to the customer are numerous and obvious. Not only does the customer get more flexibility in terms of their purchasing decision and increase their purchasing power with an approval, they also immediately come to understand that the retailer wants them to make a purchase and is there to support them in doing so.
Lenders understand that perspective perfectly; after all, the need for lending options and the comfort, security, and ease that lending provides to customers is the whole bedrock of the retail finance industry. For lenders, providing lending options through a retail business is a win-win; it gets those lending options in front of more customers, and it helps the lender establish relationships with retail business clients that will last for years to come, just as those retail businesses seek to establish lasting relationships with their own customers.
So, if the lender-retail business client relationship is such an obvious win for both parties, why are there sometimes difficulties for lenders when it comes to their retail clients? It really boils down to a few key issues that tend to plague lenders as relates to retail finance.
Issue # 1 – Inactive Merchants
50% of retailers that sign up for a lending option never use it. Let’s take a moment to reflect on the significance of that. Fully half of the retailers that select a lending option to make available to their customers for the purpose of financing their purchases never leverage that option. For lenders, that is a major frustration. Inactive merchants may be ones that are not nurturing their retail finance program, or they may be ones that aren’t using your lending option. Whatever the case may be, they represent a sink of time and energy that isn’t being repaid, and is unlikely to ever be repaid unless there is a drastic change.
Issue #2 – Low Application Volume
Similar to the trickle – or non-existent stream – seen with inactive merchants, low application volume is often a result of the structure of the retail clients’ process. Maybe they aren’t using you as their primary lender. Maybe their retail finance program is stuck in the dark ages and their sales team doesn’t even bother offering it to customers because they know what a slog the application process is. There are a lot of reasons why a retail client might have a low volume of applications, and most of them have to with fundamental flaws in their finance program, which, on the surface, it doesn’t seem like lenders have any power to correct.
Some lenders turn to waterfall companies for assistance with resolving these kinds of issues. But, as we are about to see, that isn’t always a surefire solution.
Issue #3 – Indirect Relationships
Some waterfall companies create a barrier between the merchant and lender. With an indirect relationship, merchants don’t actually log into your portal to complete the application process. This creates a further distance between you and the merchant in question, which simply isn’t good for business.
Issue #4 – Development Costs
Integrating with waterfall companies is often an expensive prospect. These companies are offering you what is supposed to be the ultimate solution to your problem, and they often present very pricey upfront development prices, knowing you are weighing those prices against the aforementioned problems you are having with merchants. They have you in the perfect position to get you to pay for that development, and they know it. What’s more, the architecture they develop today may very well need to be updated tomorrow, resulting in even more costs for you.
Issue #5 – Portal Limitations
The portal being used for finance applications by a given merchant may not be ideal for you. You may not be the first lender run. Your competition may be right next to you in the portal. Any number of less-than-ideal circumstances can crop up when the portal in question was not built according to your specifications.
How FormPiper Solves All of Those Issues
All of the issues mentioned above can cause problems with merchants and hamper your relationship with them. Fortunately, there is a solution that directly addresses all of these issues, helping you build better client relationships with your merchants.
FormPiper delivers on several fronts. First of all, FormPiper addresses the problem of inactive merchants by making it easy for your merchants to utilize all of their lending options, and, therefore, increase your opportunity to close a deal. Similarly, FormPiper ensures more visibility in the event you are not the merchant’s primary lender. It simplifies the retail store’s process, resulting in a 76% increase in the number of your applications being run.
FormPiper also helps you maintain direct relationships with your merchants. Our platform actually logs in directly to your portal and populates the application there. Once your merchant gets an approval, they can easily complete the process in your portal.
The FormPiper solution also addresses the high development costs frequently associated with waterfall companies. Our unique development process enables us to connect with your application seamlessly, eliminating any extra costs to you.
Finally, FormPiper addresses portal limitations by offering a truly grey labeled solution. You’ll be able to create your own custom portal, enabling you to be run first, remove competition from your portal, and more. We’ll customize the perfect solution to meet your needs.
All in all, what FormPiper does for lenders like you is helps you establish better relationships with your merchants, boost your applications, and fine-tune your platform to your particular needs. Moreover, it also grants additional exposure, as we introduce your program to our network of retailers, so you can start building even more relationships. Sound too good to be true? Need to see it to believe it? Contact us today and find out for yourself why so many lenders are turning to FormPiper.