How to Offer Finance for Heat Pump Installations

Why Offer Finance on Heat Pump Installations?

Providing finance options can be a game changer for both your business and customers. Here’s why:

• Make heat pumps affordable: Upfront installation can cost £7,000–£15,000. Spreading costs boosts accessibility.
• Increase sales velocity: Flexible payments remove cost barriers and speed up buying decisions.
• Enhance competitiveness: Stand out against rival installers by catering to more budgets.

"Finance options can transform the way you grow your heat pump business."

Types of Finance You Can Offer

Consider which finance models best suit your customers and business structure:

• Interest-free credit: No added cost to the customer — you may subsidise the interest.
• Interest-bearing credit: Customer pays interest, generally making this cost-neutral for you.
• Buy now, pay later: Enables customers to delay payments (often 6–12 months).
• Personal loans via third-party lenders: Simple application processes, flexible terms.

Step-by-Step: Getting Set Up to Offer Finance

1. Choose a reputable retail finance broker: They partner you with FCA-authorised lenders, provide compliant documentation, and handle applications.
2. Get FCA authorisation or become an appointed representative (AR): For offering regulated consumer credit.
3. Integrate finance into your sales journey: Options include point-of-sale, online checkout, or application links.
4. Train your staff: Make sure every team member understands finance products, eligibility, and compliance rules.

Callout: Key Compliance Requirement

Always make sure you use FCA-compliant finance documentation and only promote finance suitable for your customer’s needs and circumstances.

Compliance, Regulation, and Best Practice

Navigating the regulatory environment is key:

• FCA Regulation: You must be either directly authorised by the Financial Conduct Authority or operate as an AR under a principal firm like a retail finance broker.
• Treating Customers Fairly: Clear marketing, honest terms, and transparent APRs are a must.
• Data Protection: Handle customer information in line with UK GDPR standards.

"Getting FCA regulated is essential to legally and ethically offering finance to your customers."

Selling Effectively With Finance Options

Consumer finance isn’t just an add-on — it’s a sales tool.

• Display monthly prices: Lead with the affordable monthly cost rather than the total amount.
• Pre-qualify customers: Use soft search eligibility checks where possible.
• Promote available government grants: Combine finance offers with information about the Boiler Upgrade Scheme (BUS) or other incentives.

A Practical Example

Suppose a heat pump installation costs £10,000. By showing customers a finance option of £97/month over 10 years (subject to status), you increase accessibility and boost sales.

Frequently Asked Questions

Q: Do you need FCA authorisation to offer finance?
A: Yes. You must either be authorised or an appointed representative of an FCA-authorised firm.

Q: Can finance be combined with grants?
A: Yes. Finance can cover the shortfall between government incentives and the total installation cost.

Q: Will offering finance affect my cash flow?
A: In most cases, you get paid in full by the lender once installation is complete, so cash flow is improved or unaffected.

Final Tips

• Partner with a specialist like Kandoo for expertise and access to a network of UK lenders.
• Update your marketing with clear, compliant finance promotions.
• Monitor and refresh offers regularly to suit market rates and customer needs.

"Finance shouldn’t be complicated — it should make your heat pump business thrive."

Ready to Get Started?

Contact Kandoo today to learn how easy it is to offer your customers affordable, compliant finance on heat pump installations. Empower your sales, support your customers, and grow your business.