LONDON—Banks and credit unions might want to pay attention to a growing competitor in the loan space: loans made at the point of sale.
Divido and lastminute.com are partnering with Mastercard to launch instant financing options in the U.K., which lets retailers and businesses offer eligible customers the opportunity to spread the cost of their purchases over a period of time using installments.
“The flexibility of financing at the point of sale is particularly attractive to those faced with large-ticket purchases: Spreading out the cost with clear terms lets travelers budget better and helps them plan their holidays more effectively – and enjoy them worry-free. And consumer confidence in alternative lending is growing. A third of U.K. shoppers view retail finance as a convenient way to spread the cost of expensive purchases, and nearly one in five call the availability of different finance options the most important factor when making big-ticket purchases,” Mastercard said.
‘Seamless Payment Options’
“We are always looking for innovative ways to deliver seamless payment options for consumers and value-enhancing solutions for our retail partners,” says Zahir Khoja, senior vice president, Global Acceptance, Mastercard. “Our partnership with Divido and lastminute.com gives travelers greater flexibility to book and pay when convenient for them.”
Divido’s platform provides instant access to credit by connecting shoppers to multiple lenders at the moment of purchase, whether buyers are online, on payment-enabled devices or in store. With lastminute.com, the consumer applies for financing as part of the checkout process by providing personal information and selecting their desired loan term. The loan application is sent to Fly Now Pay Later via API, and if approved, the consumer checks out as normal. The consumer’s monthly payments are automatic and transparent.