Flexiti And The B2B Service Of Flexible Financing

Point-of-sale (POS) financing can, for retailers, be a boon and might make the difference between a small sale and a large one — or making a sale at all. The large cash or credit card outlay for durable goods can prove daunting to a customer; knowing when and how to provide credit — or if that customer can be approved at all — can be daunting to a retailer.

In a recent announcement by Flexiti Financial, a Canada-based technology firm providing POS financing and technology for firms in that country, $5 million in a Series A round recently closed will help speed merchant adoption of flexible payment plans.

In an interview with PYMNTS, Peter Kalen, who serves as CEO of Flexiti Financial, said that Flexiti has earmarked the capital for growth and continued investment in technology.

Kalen said he sees opportunity for bringing retailers on board to offer low- or no-interest financing to their end customers. But getting retailers in Canada on board with the idea of deferred payment plans also means getting merchants to embrace the technology that allows them to approve financing on the spot. Neither consumers nor retailers themselves, said Kalen, want to spend time in the store filling out the paperwork manually and waiting around just to find out that the application is ultimately rejected.

Kalen noted that the platform offered by his company allows retailers to offer both the flexible financing and a virtual, private-label credit card that can be approved and set up in minutes. In providing these services, Kalen said Flexiti is working with a trend for financing that has as its focus the elimination of paper and moving beyond credit applications that involve interactions between “fax machines and call centers” in the financing process and, in the virtual card space, bypassing plastic itself.

As for the credit issuance itself, providing what is essentially a B2B service via apps or the firm’s own tablets to smaller retailers, said Kalen, can help drive corporate customers’ sales as those retailers adopt flexible financing. The typical profile of a retailer targeted by Flexiti does not include behemoths of commerce, but rather they are smaller chains “of around seven or eight or 10 stores.”

The typical financing program, he said, lasts between six and 12 months for larger-ticket items (think of household appliances, the ones that last for years). Notably, Flexiti holds the consumer risk and relationship on its own books once the sale is made, which, he said, can help a salesperson garner an additional sale. As Kalen offered in a hypothetical situation, picture the $1,000 washing machine that can result in an extra sale along the same scale if bundled with a dryer and flexible terms. That service, he said, can help boost salesperson productivity (and, of course, the retailer’s cash flow).