Versatile Credit and American First Finance are now helping merchants reduce the risk of unnecessary credit checks.
Their new deployment brings together Versatile Credit’s credit aggregation and customer acquisition tool and American First Finance’s technology that facilitates alternative financing and lease-to-own solutions, the companies said in a Thursday (Jan. 26) press release.
Together, they enable merchants to provide second-look financing and lease-to-own options to their customers while also reducing the risk of unnecessary credit checks for options for which the customer is not eligible, the release said.
“There has been a lot of economic uncertainty throughout the last few years, leading to consumers who are monitoring their credit hits and scores more and more,” Versatile Credit President and Chief Operating Officer Vicki Turjan said in the release. “In this type of environment, tools like prequalification are incredibly important in helping to guide customers to a financing product that fits their borrowing profile, without discouraging them with risk of a hard credit check.”
Offering a broad range of financing options helps merchants’ sales while improving the customer experience, Turjan told PYMNTS in an interview posted in December.
At a time when many consumers are under financial pressure, living paycheck to paycheck and seeing their credit scores fall from prime levels, merchants need a full stack of financing options available at the point of sale (POS) to help drive sales conversions, Turjan said at the time.
At the same time, consumers want to avoid hard credit checks that can impact their credit score, preferring instead either no credit check or a soft credit check that does not affect the score.
With the new collaboration between Versatile Credit and American First Finance, merchants can offer their customers financing solutions via traditional self-service kiosks, merchant-owned tablets, eCommerce and contactless, transition-to-mobile technology, according to the press release.
The prequalification functionality ensures that shoppers are prequalified before moving on to an application to complete the process, the release said.
“AFF is eager to deploy prequalification to Versatile’s platform,” American First Finance Head of National Sales Matt Dishman said in the release. “Prequalification is a critical tool for educating consumers about their available options and providing them with a quick and easy way to apply, while also improving retention rates for merchants.”
PYMNTS Data: Why Consumers Are Trying Digital Wallets
A PYMNTS study, “New Payments Options: Why Consumers Are Trying Digital Wallets” finds that 52% of US consumers tried out a new payment method in 2022, with many choosing to give digital wallets a try for the first time.