How To Offer Finance For Monthly Payment Plans

Customer finance, as customers now expect it

Customer finance is no longer a niche checkout add-on. In the UK, Buy Now, Pay Later already accounts for around 8% of online and in-store point-of-sale spend and is forecast to edge higher towards 9% by 2030. That matters because it signals a behaviour shift: customers increasingly treat instalments as a normal way to budget, not a last resort. For your business, offering monthly payment plans can help you compete on affordability without discounting, protect margins, and open your products or services to customers who would otherwise delay buying. Just as importantly, it lets you present price in a way that matches how people make decisions: in manageable monthly amounts.

Banner image concept: A modern UK high-street at dusk. A young couple stands outside a boutique electronics shop, smiling with a shopping bag and a phone showing a clear “Pay in 3” or “Monthly plan” screen. Warm shop lighting, subtle finance logo on the window, confident and realistic.

Standout line: If customers compare monthly affordability, your checkout should too.

Why customers choose instalments in the first place

Customers use finance because it reduces the immediate friction of paying in one lump sum. UK research indicates BNPL structures can make people feel less financially constrained than paying upfront or even simply deferring payment, because the cost is broken into clear, predictable instalments. In a tighter economy, that clarity can be the difference between “I’ll think about it” and “I’ll do it now”. The trend is particularly visible among younger shoppers: around a third of Gen Z in the UK have used BNPL, and they tend to prefer mobile-led, transparent options that feel integrated into the buying journey. Even beyond Gen Z, average BNPL transaction sizes have risen to around £114, reinforcing that customers are using these tools for everyday purchases, not only big-ticket items.

How monthly payment plans can lift sales without cutting prices

Offering finance can increase sales by improving conversion, increasing average order value, and widening your reachable customer base. When customers see a monthly figure alongside the full price, the purchase often feels more attainable, especially for discretionary or mid-sized buys where hesitation is common. BNPL is also increasingly omnichannel: shoppers who use instalments both online and in-store can spend significantly more per transaction than those who use it in only one channel, with some reporting up to a 72% uplift. Practically, this means your finance offer should travel with the customer across channels, so they can start browsing on mobile, ask questions in-store, and complete the purchase wherever is convenient. Over time, finance can also support retention: while many UK consumers use BNPL occasionally, frequent users can be highly engaged when the experience is smooth and the messaging is relevant.

Next-step suggestions

• Add a “from £X per month” message on product pages and quotes, not just at checkout.

• Offer at least two plan lengths so customers can choose affordability versus speed of repayment.

• Make finance available online and in-person if you sell across both.

Typical transaction values for monthly plans

What you can offer on monthly payments

1. Electronics and home tech (TVs, laptops, appliances)

2. Home improvement and trades (kitchens, bathrooms, windows, solar)

3. Health and wellbeing (dental, optical, private treatments)

4. Automotive-related services (repairs, tyres, detailing, accessories)

5. Travel and experiences (holidays, tours, higher-value bookings)

6. Veterinary care and pet services (procedures, treatment plans)

7. Furniture and interiors (sofas, beds, fitted storage)

FCA and responsible finance, in plain English

In the UK, retail finance is shaped by FCA expectations around clear, fair customer outcomes. As BNPL becomes mainstream, there is growing emphasis on responsible lending, affordability checks, transparent disclosures, and appropriate support for customers in difficulty. Your marketing should be clear on key terms, avoid misleading “free money” framing, and make it easy for customers to understand repayment schedules, consequences of missed payments, and any interest-free conditions. Work with partners that take compliance seriously and keep your staff trained on what they can and cannot say.

The introducer model: how brokers make it simple

Many businesses offer finance without becoming lenders themselves by acting as an introducer. In an introducer or broker model, you present finance as a payment option and introduce the customer to a regulated finance partner who assesses eligibility, presents the agreement, and handles repayment. This structure can reduce operational burden and risk: you focus on selling the product or service, while the lender or broker manages underwriting, documentation, and ongoing account servicing. Done well, it also improves customer experience because the application is integrated into the journey and decisions are quick. As finance becomes a standard payment method, reliability and smooth integration matter as much as the rate.

What the customer journey typically looks like

1. Customer sees affordability early: “From £X per month” on product pages, quotes, or in-store signage.

2. Customer chooses finance at checkout or point of quote: They select a term length and review an estimated schedule.

3. Short application: Basic personal details, identity checks where required, and affordability assessment.

4. Decision in principle: Approved, referred, or declined, with clear on-screen messaging.

5. Agreement and e-sign: Key information is presented before commitment; customer accepts digitally.

6. Order confirmation: You receive confirmation to supply goods or schedule the service.

7. Fulfilment: Delivery, installation, or appointment goes ahead as normal.

8. Repayments and reminders: Customer receives payment notifications and account updates.

9. Support if things change: Clear routes for customers who may struggle, including hardship options where applicable.

Getting started with Kandoo

Kandoo is a UK-based retail finance broker, helping businesses offer monthly payment plans in a way that is clear for customers and practical for teams. The goal is straightforward: present finance as a normal payment method, match customers’ preference for transparent instalments, and keep the experience consistent across online and offline touchpoints. A good rollout starts with your typical basket values and customer questions, then builds a finance offer that fits your range, from smaller pay-in-3 purchases through to longer-term plans for higher-value jobs. Once live, you can refine where finance is shown, which terms convert best, and how your team introduces it so customers feel informed, not pressured.

Standout line: Understanding APR is not just about percentages - it is about knowing what you will pay in real terms.

FAQs

What is the difference between BNPL and monthly finance?

BNPL often refers to short, interest-free instalments such as pay-in-3, while monthly finance can include longer terms and may be interest-free or interest-bearing depending on the product and term.

Is BNPL only for online retail?

No. BNPL is increasingly used in-store as well as online, and omnichannel customers can spend more when the experience is seamless across both.

Will offering finance reduce my margins?

Not necessarily. Many businesses use finance to avoid discounting, improve conversion, and increase average order value. Any costs should be weighed against uplift in sales and margin protection.

What do customers care about most when choosing instalments?

Clarity and control: the monthly amount, number of payments, any interest-free period, and what happens if a payment is missed.

Do I need to be FCA authorised to offer finance?

Often you can operate as an introducer under an appropriate structure, but requirements depend on how you promote and arrange finance. Use a regulated partner and ensure your processes and training support compliant communications.

Does finance help with higher-value services like dental, travel, or home improvement?

Yes. Instalments are increasingly used beyond retail, including travel, healthcare and treatments, and home improvement, where spreading the cost can unlock demand.

How can I make finance feel trustworthy at checkout?

Show total cost and monthly cost clearly, avoid hidden conditions, keep the application simple, and provide easy access to support and repayment information.

What is a sensible way to present finance on my website?

Start with “from £X per month” on relevant pages, add a calculator or example repayment, and repeat the option at basket and checkout so customers can revisit the choice.

How quickly can I launch monthly payment plans?

Timelines vary by integration and readiness, but a focused project covering product selection, compliance wording, and staff training can get you live quickly once approvals and setup are in place.