How to offer finance to customers online

The online finance moment you cannot ignore

Offering finance at checkout used to be a nice-to-have. In the UK’s 2025 landscape, it is a growth engine that lives or dies on compliance. Consumer Duty has reset expectations for clarity and fairness, the Data (Use and Access) Act 2025 tightens privacy, and payment reforms sharpen the focus on safeguarding and authentication. Meanwhile, the FCA’s plan to bring Buy Now, Pay Later within scope raises the bar for disclosures and affordability. The opportunity is real, but so are the requirements.

What makes this moment different is the convergence of regulation and innovation. Open Finance enables smarter decisions with customer consent, while a world-class fintech ecosystem means better integrations, faster onboarding, and clearer pricing. UK consumers are highly digital and already comfortable with fintech. That creates demand for seamless, transparent finance online - but also obliges providers to demonstrate value, prevent foreseeable harm, and minimise friction without compromising security.

If you are weighing up retail finance, BNPL, or embedded credit, start with the end in mind: fair value, clear language, and operational resilience. That means explaining APR in pounds and pence, designing journeys that support understanding, and using data proportionately and lawfully. It also means building in Strong Customer Authentication, planning for evolving e-money safeguarding, and putting controls around AI-driven marketing and personalisation. Done right, finance options can increase conversion and average order value while keeping customers informed and protected.

Kandoo is a UK-based retail finance broker. We connect consumers with a panel of lenders and help merchants offer finance online while aligning to UK rules. Whether you build in-house or partner, the same principles apply: evidence your outcomes, document your choices, and make your website work for the customer first.

Understanding APR is not just about percentages - it is about the pounds you will pay in real terms.

Who should pay attention

If you sell higher-ticket products or services online - from home improvements and healthcare to mobility and consumer electronics - finance at the point of sale can remove friction and unlock deferred demand. It also suits marketplaces and platforms seeking embedded finance to support sellers and buyers. Marketing leaders need to translate regulatory language into plain-English webpages, while product and engineering teams must implement compliant user journeys, consent flows, and payment controls. Compliance and risk teams should map Consumer Duty outcomes across the site, and data teams must align tracking and personalisation with the Data (Use and Access) Act 2025 and ICO guidance. Even smaller merchants can benefit by partnering with regulated brokers and lenders who provide compliant tools out of the box.

The essentials you need to know

• Consumer Duty: Requires firms to act in good faith, avoid foreseeable harm, deliver fair value, and support customer understanding through clear, accessible information.

• Financial promotions: Must be fair, clear, and not misleading across web, email, and social channels, including any influencer activity.

• BNPL regulation: The FCA plans to regulate BNPL and deferred payment credit, increasing requirements on transparency, affordability, and disclosures.

• Data privacy: The Data (Use and Access) Act 2025 plus ICO guidance emphasise transparency, consent, data minimisation, and clear privacy notices.

• Open Finance: Customer-permissioned data sharing enables personalised pricing and eligibility checks that can improve outcomes and reduce friction.

• Payment safeguards: E-money safeguarding rules are being overhauled and SCA continues to evolve to reduce fraud and secure transactions.

• AI governance: AI-driven targeting and content must comply with Consumer Duty and data privacy standards, with controls to prevent bias or misleading outputs.

Your routes to offering finance online

1. Partner with a retail finance broker

   • Access multiple lenders, prebuilt journeys, credit checks, and compliant disclosures. Faster to market and simpler oversight with regulated expertise.

2. Integrate a single specialist lender

   • Direct contract with one provider. Tighter integration control, but concentration risk and more work on contingency and value assessments.

3. Add regulated BNPL or deferred credit

   • Popular at checkout with short-term instalments. Prepare for incoming FCA regulation, clear Ts&Cs, affordability checks, and late-fee transparency.

4. Build an in-house embedded finance stack

   • For large platforms with engineering and compliance capacity. Highest flexibility, but significant regulatory and operational responsibilities.

5. Use Open Finance for pre-qualification

   • With customer consent, use bank data to assess affordability quickly, improving approval rates and reducing credit friction.

Quick win: test finance placement above the fold and on product pages to lift conversion, then iterate with clear pound-and-pence examples.

Pounds and pence: what it could mean

Who can qualify to offer finance

Most UK online merchants can offer point-of-sale finance by partnering with a regulated broker and lenders who carry authorisations and underwriting. You will still need to ensure your website, marketing, and customer service meet Consumer Duty outcomes, including fair value and clear communication. If you issue credit directly, you may require FCA authorisation and must comply with financial promotion rules, affordability assessments, and reporting. For BNPL, expect additional obligations as regulation comes into force, including product governance and clear, accessible disclosures. Data handling must align with the Data (Use and Access) Act 2025, including lawful bases, explicit consent where needed, clear retention periods, and data minimisation. Finally, payment flows should incorporate Strong Customer Authentication where applicable, and your operational setup should evidence resilience and safeguarding arrangements expected by updated UK payment and e-money standards.

From idea to live in a week-by-week path

1. Define goals, KPIs, and fair value narrative.

2. Choose broker or lender and confirm permissions.

3. Map journeys and write clear, compliant content.

4. Implement APIs, Open Finance checks with consent.

5. Configure SCA, settlement, and safeguarding controls.

6. Test disclosures, affordability, and edge cases.

7. Train support teams and publish policies.

8. Launch, monitor outcomes, review complaints monthly.

The trade-offs at a glance

Read this before you switch it on

Treat your website like a regulated storefront. Explain costs in pounds as well as APR, avoid jargon, and present risks clearly. Do not rely on social media shortcuts; ensure any influencers are authorised and your promotions are approved. Keep your data practices tight: ask only for what you need, explain why, and let customers opt out easily. Test for foreseeable harm, such as nudges that encourage unaffordable borrowing. Prepare for BNPL oversight by documenting product governance, value assessments, and late-fee policies. Build resilience through incident response playbooks, supplier oversight for critical third parties, and ongoing monitoring of SCA performance and chargebacks.

If finance is not the fit today

1. Savings and layaway plans with scheduled reminders.

2. Referral to impartial budgeting and debt advice resources.

3. Price-matching or cashback alternatives to subsidise cost.

4. Subscription or rentals with clear end-of-term options.

5. Limited-time promotions with transparent eligibility and caps.

Common questions, straight answers

Q: Do I need FCA authorisation to offer checkout finance? A: If you broker customers to lenders via a regulated firm, you may not require your own authorisation. Direct lending or certain promotions can require permissions. Seek specialist advice.

Q: How will BNPL regulation affect my checkout? A: Expect clearer disclosures, affordability checks, and product governance. Plan content, journeys, and policies now so changes are incremental rather than disruptive.

Q: What does Consumer Duty mean for my website copy? A: Use plain English, show pounds-and-pence examples, avoid sludge, and evidence that customers can understand key features, risks, and costs before applying.

Q: Is Open Finance safe and compliant? A: With explicit consent, minimised scopes, and secure providers, it can reduce friction and improve affordability assessments. Document your purposes and retention periods.

Q: Will SCA hurt conversion? A: Not if implemented thoughtfully. Use exemptions appropriately, monitor step-up rates, and tune UX. The goal is fewer fraud losses with minimal friction.

Q: Can I use influencers to promote finance? A: Only within financial promotion rules. Unauthorised finfluencer activity risks enforcement and reputational damage. Keep approvals and records.

What to do next

Map your current journey against Consumer Duty outcomes and data privacy requirements. Speak to a regulated broker like Kandoo to scope lender coverage, integration effort, and fair value. Prioritise one product page and your checkout for a pilot, implement Open Finance-driven pre-qualification with consent, and harden payments and SCA. Measure conversion, approvals, complaints, and customer understanding, then iterate.

Important information

This article provides general information for UK businesses and is not legal, tax, or regulatory advice. Regulations evolve and apply differently by firm. Obtain professional advice and confirm your permissions before launching any finance offering online.