Offer finance for your customers

Why offering finance is working right now

Consumer spending is being reshaped by finance rather than avoided because of it. UK data shows momentum: new consumer finance rose 6% in October 2025 versus a year earlier, lifting the 10‑month total to £31.4bn and keeping providers on course for a record £122bn this year. Net consumer credit borrowing held at £1.5bn in September, with credit cards steady at £0.7bn each month. Outstanding consumer credit reached £235.9bn by March 2025, up £12.6bn year on year. These are not abstract figures. They reflect how households manage big and everyday purchases when disposable incomes are tight.

For retailers, that demand translates into conversions. Customers want predictable payments, transparent costs and approval paths that fit real life. Finance at checkout can unlock higher average order values and lower basket abandonment, particularly for electronics, furniture, home improvements and mobility products. Even housing activity helps. Mortgage approvals rose to 65,900 in September, which often precedes financed purchases of home goods. Meanwhile, average personal loan APRs around 11.13% and overdrafts at far higher rates mean competitive retail finance can be more attractive than high street borrowing.

Kandoo is a UK-based retail finance broker that connects your business and your customers to suitable lenders and products. We broker responsibly, align with FCA rules, and focus on clarity for shoppers. The outcome is simple: you offer flexible payment choices without becoming a lender yourself, while we handle the heavy lifting so customers can buy with confidence and you can sell more, more often.

Finance is not just about affordability - it is about confidence at the point of decision.

Who benefits from adding finance

If you sell higher-value items or services where price creates hesitation, finance can change the conversation. Independent retailers, multi-site chains and ecommerce brands see faster checkouts and fewer lost baskets when monthly costs are clear. Home improvement firms, mobility and medical suppliers, automotive aftermarket, and premium consumer tech all map well to staged payments. Even seasonal spikes benefit, because revolving credit and instalments smooth peaks for customers while protecting your cash flow.

If you are rebuilding demand, launching new lines, or serving cost-conscious households, finance provides a measured nudge. Your customers gain choice and transparency. You gain predictable conversion without heavy discounting.

Finance options you can consider

1. Interest free instalments - short terms where customers pay no interest, you fund a subsidy.

2. Classic fixed-term credit - equal monthly payments over 6-60 months at a set APR.

3. Buy now, pay later with deferral - a payment holiday followed by instalments or a lump sum.

4. Revolving credit - reusable credit lines that support repeat purchases and add-ons.

5. Second-charge homeowner loans - for larger home improvement projects secured against equity.

6. Brokered personal loans - customers apply for an unsecured loan to fund the purchase.

Cost, impact, returns and risks at a glance

Stronger GB demand in 2025 suggests returns from finance can outweigh subsidies, particularly where basket sizes are £500-£5,000 and price sensitivity is acute.

Who is eligible and what lenders look for

Eligibility has two sides: your business and your customers. As a merchant, you will typically need to be UK-registered, trading for at least several months, and able to evidence fulfilment, refunds and customer service standards. You should be comfortable integrating compliant customer journeys, clear price displays and accurate pre-contract information. If you promote regulated credit, financial promotions rules apply and your processes must support fair outcomes.

For customers, lenders assess identity, affordability and credit history. They look at employment or income stability, existing debt levels and how the new commitment fits the household budget. Data in 2025 shows many households rely on credit, so clarity on total cost and term length matters. Options range from interest free instalments to classic fixed-term credit and, for homeowners, second-charge mortgages where equity is suitable. Kandoo brokers across these products, matching customers with appropriate lenders so you can offer finance without becoming an expert in every detail.

Getting started in simple steps

1. Share your sector, price points and volumes with Kandoo.

2. We map suitable lenders, terms and promotional APRs.

3. Agree products, disclosures and operational workflows.

4. Integrate the checkout or in-store application journey.

5. Train staff on fair, compliant customer conversations.

6. Launch, monitor approvals and optimise plan mix.

7. Review results and refine subsidies by performance.

Upsides and trade-offs to weigh

What to check before you switch it on

Set a clear target for conversion, average order value and payback so everyone knows what good looks like. Review pricing so the cost of any subsidy fits your margin, seasonality and stock turns. Ensure your marketing claims around interest free or low APR are fair, balanced and compliant. Test the customer journey end to end, including declines, cancellations and refunds, so staff know exactly what to do. Finally, plan for exceptions. If volumes spike during promotions, you will want lender capacity, stock availability and delivery timelines aligned to avoid disappointment.

Alternative paths if finance is not a fit

1. Offer staged deposits and split invoices without third-party credit.

2. Introduce lay-by style reservations with flexible collection dates.

3. Promote card instalments via issuer programmes where available.

4. Use targeted discounts for price-sensitive baskets only.

5. Provide subscription or rental for high-usage products.

Frequently asked questions

Q: Will offering finance hurt my margin? A: It can if unmanaged. Many retailers balance a small subsidy with improved conversion and higher average order values. Track incremental profit rather than unit margin in isolation.

Q: Are customers actually using finance in 2025? A: Yes. Consumer finance new business is up, net borrowing is steady, and outstanding credit has risen. Finance is part of how households manage purchases when incomes are under pressure.

Q: What APRs do customers see? A: It depends on product and profile. Interest free options cost you a subsidy. Fixed-term credit and personal loans vary, with recent averages around low double digits for unsecured loans.

Q: How quickly do I get paid? A: Typically on activation, often same day to a few days depending on the lender and product. This is usually faster and more predictable than offering long internal payment plans.

Q: Do I need FCA authorisation? A: It depends on what you do and say. Many promotions are regulated activities. Kandoo helps structure journeys and communications so your approach is compliant and practical.

Q: What happens if a customer cancels? A: Standard consumer rights apply. Lenders unwind the agreement and you process refunds according to policy. Clear returns processes reduce disputes and chargebacks.

How Kandoo helps you win more customers

Kandoo matches your products and price points to a curated panel of UK lenders, covering instalments, classic credit, personal loans and homeowner options. We design compliant journeys, integrate quickly online and in store, and support staff training so finance becomes a natural part of the sale. With data-led plan mix and transparent reporting, you improve conversion without complexity.

Important information

This content is for general information only, not advice. Credit is subject to status, affordability and terms. Product availability, APRs and eligibility vary by lender and customer profile. Merchants remain responsible for compliant promotions and fair customer outcomes.