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In-House Financing

Updated on July 14, 2024 , 1668 views

What is In-House Financing?

In-House financing refers to when a company extends a loan to customers in order to allow them to purchase goods and services. In other words, in-house financing means that the company does not rely on the finance sector for providing customers with funds for a transaction. Banks and third-party institutions are eliminated through in-house financing.

In-House Financing

This method is great for customers as it encourages purchase among them. Retailers should be having a good and established relationship with the company or single-third party credit providers to help service a loan to customers. One of the biggest benefits of the system is that the loan is easily available with fewer procedures in comparison to getting a loan from a Bank.

Technology and In-House Financing

With new financial technology companies coming into existence, customers have a greater reach to in-house financing options through fast and convenient point-of-sale credit platforms. This platform can be built around a company’s in-house credit department or can be a product of partnering with a single credit provider.

Point-of-sale financing helps ease out the lending process for customers. It allows them to apply for credit at a point where they are ready to buy. The credit decision is made within minutes under this method and it also makes it easier to close the deal soon.

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According to a report, companies that went for point-of-sale financing saw sales grow by 32%. For instance, a fintech company called Affirm is one of the most popular point-of-sale platforms that is associated with thousands of retailers for immediate financing.

Important Points About In-House Financing

One of the most popular industries using in-house financing is the automobile Industry. The automobile sales industry is a business that relies on buyers taking auto loans for purchasing a vehicle. Offering financing to a car buyer helps the company close a deal soon.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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