Is Your Business Ready to Offer Consumer Credit?

Who Should Read This?

If you run a business in the UK and want to help your customers spread the cost of their purchases, this guide’s for you. Maybe you sell kitchens, garden makeovers, or even e-bikes. Perhaps you’re just starting out or you’ve been thinking, "Should I let my customers pay by monthly instalments?" If that sounds familiar, read on.

What We Mean By "Consumer Credit"

Let’s keep it simple: consumer credit means giving customers the option to buy now and pay later. They can split the bill into smaller chunks, instead of coughing up all at once. This could be via interest-free loans, buy now pay later schemes, or instalment plans.

Why Bother With Consumer Credit?

Here’s the honest truth. Offering credit can:

• Bring in bigger orders (people spend more when they can spread the cost)
• Help you stand out from rivals who only take cash or card
• Make life easier for customers, especially when budgets are tight

But it’s not just about boosting sales. It shows your business understands what people need—flexibility and less stress over big purchases.

The Nuts and Bolts: How Does It Work?

Look, nobody wants a headache. Here’s what usually happens:

1. You team up with a finance provider or broker (like us at Kandoo).
2. Your customer chooses the products or services, then asks about paying monthly.
3. You send them to your finance partner—they’ll do a quick check to see if the customer’s eligible.
4. If approved, the customer signs the credit agreement. You get paid upfront (after a small fee), the customer pays monthly.

No chasing payments. No lending your own money. Simple.

Picture This: A Real Example

Sally runs a kitchen fitting business in Manchester. Her average job is £7,000—a stretch for many customers. By offering consumer credit, she lets customers split payments over 2 years. Suddenly, she’s winning jobs she used to lose. Her cashflow improves, too, because her finance broker pays her within days. Everyone’s happy—Sally included.

Confused? Let’s Break Down The Lingo

TermWhat It MeansAPRAnnual Percentage Rate—the cost of borrowing including interest and feesRegulatedMeans the finance follows rules set by the Financial Conduct Authority (FCA)BrokerA middle-person who finds finance deals for your customersCredit CheckA quick look at a customer’s finances to see if they qualifyInstalment PlanSplitting the bill into monthly paymentsSoft SearchA gentle credit check that doesn’t leave a mark on your record

Questions Business Owners Often Ask

Do I need a special licence?
Yes, most of the time. The FCA (Financial Conduct Authority) keeps things above board. But if you use a broker like Kandoo, you might be able to offer credit under their permissions—saving you the hassle.

Will my business get paid straight away?
Usually, yes. The finance provider pays you up front (minus any agreed fee).

Is it risky for my company if a customer doesn’t pay?
Nope. The finance provider chases the customer—not you.

How long does it take to set up?
If you use a broker, it can be up and running within days, not weeks.

Ready to Take the Next Step?

Offering consumer credit doesn’t have to be a faff. If you want to offer your customers more choice—and see your sales grow—get in touch to see how Kandoo can help. No nonsense, no hidden nasties. Just straightforward advice and an easy setup.