MECHANICSBURG, Pa. — While store traffic remains light, according to furniture retailers, the role of credit continues to be a key driver. Versatile Credit, a consumer financing company focused on waterfall financing solutions, noted that in-store furniture financing programs experienced a rise in unique applicants by 10% and approved financing totals by more than 26%, compared with January 2021.
“We are projecting to see a significant increase in the number of applications processed through our platform, with a target of 5 million total applications in 2023,“ said Ed O’Donnell, CEO of Versatile Credit. “It’s clear that our technology and focus on delivering a seamless and efficient financing experience is resonating with merchants and their customers.”
Prime and no-credit-needed providers showed the most growth, according to Versatile.
Prime-approved applications increased by 8%, as well as average approved financing up by 18%. No credit needed was up by 37% in approved applications, with average approved financing growing by 6%.
Meanwhile secondary, near-prime lenders saw growth in overall applicants (up by 14%) but a slight decrease in approvals.
“Consumers are becoming more conscious and savvy about their spending habits, seeking out promotional financing and low-interest offers to help them budget in an uncertain economy,” O’Donnell said. “Our technology and features such as prequalification help connect shoppers with financing that works for them, without the hard credit checks for products they may not be eligible for.
“It’s exciting to see the positive impact our platform is having in the marketplace, and we look forward to facilitating an expected $10 billion in financing volume this year.”
Data from e-commerce transactions indicated there was a decline in total “prime credit” applicants, but that second look and tertiary credit providers showed significant growth across segments.
Prime lenders had fewer applicants but were approving a higher percentage of them, indicating the appetite for quality assets remains high.
“Our technology is empowering merchants to provide the right financing options to their customers at the right time, regardless of credit score, and making financing more accessible,” says David Miller, Versatile’s lead business analyst. “Making the data available to our merchant partners in real time allows them to quickly understand if the products they are making available to consumers are meeting demand, or if they are seeing application fallout which may indicate a product gap.”