We've all heard of "Split in 4" for buying sneakers or clothes. That's easy. But what happens when a customer needs to replace an HVAC system for $12,000 or pay for orthodontic work costing $5,000? They can't split that into four bi-weekly payments.
This is the world of big-ticket Point of Sale (POS) financing. For merchants selling high-value goods and services, offering long-term financing options at the checkout isn't just a perk—it's often the difference between a sale and a walkout. In this guide, we explore how to implement this technology to boost your Average Order Value (AOV).
1. Why Big Ticket is Different from BNPL
Typical "Buy Now, Pay Later" (BNPL) services are designed for small impulse buys. They don't check credit deeply, and they have low limits.
Big Ticket POS Financing is structured differently:
- Higher Limits: $2,000 to $50,000+.
- Longer Terms: 12, 24, 36, or even 60 months.
- Interest Bearing: Unlike "Split in 4," these loans usually carry interest, though merchants often subsidize this to offer "0% APR" promos.
Implementing this requires a more robust backend than a simple plugin.
2. The "Soft Pull" Revolution
Historically, applying for financing at a furniture store meant filling out a long paper form and waiting for a hard credit check that dinged your score. Customers hated it.
Modern POS financing uses a Soft Credit Pull. By integrating with advanced credit APIs (as discussed in our article on APIs), you can show a customer exactly what their monthly payment would be ("$150/mo for 24 months") without impacting their credit score until they actually click "Buy." This transparency skyrockets conversion rates.
3. Integration at the Critical Moment
The key to success is where you present the offer. If you wait until the customer is at the register with their wallet out, it might be too late—they may have already decided to buy a cheaper model to save cash.
Best Practice: Display financing options early in the journey.
- On the Product Page: Instead of just showing "$5,000," show "As low as $120/mo."
- In the Quote (Service Businesses): If you are a plumber sending a quote for a water heater, include a "Click to Finance" link directly in the digital invoice.
4. The Merchant Dashboard
Implementing POS financing isn't just about the customer; it's about your back office. You need a system that tracks:
- Approvals vs. Declines: Are you losing sales because your lender's criteria are too strict?
- Funding Status: When does the lender pay you? (Usually within 24-48 hours).
- Disputes: Handling returns when a loan is attached requires specific workflows.
Using a comprehensive in-house financing system or a white-label platform gives you this visibility.
5. Multi-Lender Waterfalls
No single lender approves everyone. A "Prime" lender might reject a customer with a 620 credit score. If you only have one partner, you lose that sale.
Advanced POS platforms use a Waterfall approach. The application is sent to Lender A (Prime). If declined, it instantly goes to Lender B (Near-Prime), and then Lender C (Sub-Prime). This happens in seconds, maximizing your approval rate without the customer having to re-apply.
"POS financing turns 'I can't afford that right now' into 'I can fit that into my monthly budget.' It is the most powerful upsell tool in your arsenal."
Conclusion
Implementing point of sale financing for big-ticket items is a win-win. Your customers get the quality products they need with manageable payments, and you get higher sales volume and immediate revenue.
Whether you want to partner with third-party lenders or launch your own program, Lendisys provides the infrastructure to make POS financing seamless and secure.