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Letting customers buy from your e-commerce business right now and letting them pay over time is becoming prevalent these days. Consumer spending habits have changed considerably, and these credit options help them to buy things they cannot purchase outright. The process is on the rise in the bigger stores. However, smaller stores have also started offering the same facility to their customers. The process has its risks and benefits. Your business has to pay the price upfront, including associated fees, and expect that the defaults remain at their lowest.

The process of eCommerce Financing can be an excellent tool for increasing the overall ecommerce sales of your business. However, you must consider a few things to ensure the solution suits your business. Below is a list of the things you should consider.

  • The first thing to do is to assess your market. You will identify which products or services sell the most by looking into your sales data. The average sale price is another vital metric that you have to consider. Depending on the average sale price and the overall prices of your products or services, you can ascertain if your customers want to explore the line of credit. You can conduct surveys or ask direct questions to your customers to understand their need for eCommerce financing for your business.
  • You need to look into the fees once you decide to offer eCommerce financing. There are many options available in the market. Some of these companies give services at no extra charge. Some others charge a percentage-based value, whereas others charge a flat rate. The transaction charges will be applicable across all service providers. The option you choose will depend on several factors, including your average sales, how often you wish to provide the credit line, and how often you expect your customers to choose the credit option.
  • You will need to weigh the benefits of offering the credit line. The most obvious benefit is the freedom of customers to choose expensive products. These products are often beyond their one-time expense. Many customers may want to buy a dear product, but the cost is the primary deterrent. With the benefit of eCommerce financing, customers can buy the product and make monthly payments. This will help you sell more of those products and make more profit. Statistics also show that people prefer such financing options while making eCommerce purchases. The number of customers who want to switch to an eCommerce platform offering financing is reasonably high.
  • Just like the benefits, there are risks too. The primary risk is the risk of default. Many customers may buy products from you through the financing option but fail to pay back the amount. The common practice of checking a customer’s creditworthiness on paper is no guarantee that a default will not happen. Having good business savings can help you to alleviate any such situation.

The decision to include eCommerce financing should be based on these factors. However, once you start eCommerce financing, you should be very careful about your cash flow. The slow payback process will mean you have to wait for a considerable time to receive the price of your products.

This is particularly correct if you develop an in-house financing option. On the other hand, if you work with a company that specializes in eCommerce financing, you will receive the amount upfront, but the customer approval process can take some time. Either way, cash flow is affected.

There is a solution to this.

You can opt for a high-quality business credit card. A credit card can help you build your credit score and maintain your cash flow. The credit card will help you with the financial requirements of your business if you can pay back your dues in time. If possible, you can pay the bill back in full every month. It will help you in avoiding the interests. The business credit card will also provide you with cashback and other rewards.


For increased sales and profitability, eCommerce financing can be an excellent option for your business. However, careful weighing of potential benefits and risks is essential. It will help you to arrive at the decision of whether to offer it to your customers. Always choose the financing program carefully to ensure increased sales and stable cash flow.

McClatchy newsroom and editorial staff were not involved in the creation of this content.

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Jon Stojan is a specialist writer based mostly in Wisconsin. He guides editorial groups consisting of writers across the US to enable them become more proficient and diverse writers. In his cost-free time he enjoys investing time with his spouse and small children.