In recent years, the UK’s retail finance landscape has undergone significant shifts, largely impacting vulnerable consumers and those with thinner credit files. A study highlighted by the Financial Times reveals a concerning trend: the regulated loan market is becoming increasingly inaccessible, steering shoppers towards unregulated credit products as they grapple with the rising cost of living. With non-prime lending shrinking by a third since 2019, many are left without access to traditional credit and are seeking alternatives.
Payl8r’s Response to Market Challenges
Our innovative retail finance solutions, centred around a ‘rate for risk’ model and enhanced affordability checks are designed to bridge the gap left by the shrinking subprime market. By providing a sustainable, regulated finance model that caters to both merchants and consumers, particularly those overlooked by the traditional lenders, we’re committed to boosting financial inclusion.
The Power of Rate for Risk and Open Banking
Our rate for risk model ensures that financing rates are tailored to the individual’s risk profile, offering fairer, personalised lending solutions. Together with affordability checks using Open Banking technology, we gain a well-rounded understanding of a customer’s current financial situation. This approach allows us to offer credit to those who might otherwise be excluded, including consumers with less-than-perfect or thinner credit files.
A Sustainable Future for Finance
As the subprime market continues to shrink, and with the rise of unregulated credit options, the need for regulated, responsible lending solutions has never been greater. We’re stepping up with solutions that not only address immediate financial needs but also champion long-term financial health.
Our tech-driven approach to affordability checks means we’re not just offering credit; but doing so in a responsible, sustainable way. By prioritising the financial well-being of consumers, we’re helping pave the way for a more inclusive, sustainable financial ecosystem.
Meeting Today’s Financial Challenges Head-On
Today’s financial landscape, especially for those distanced from traditional lending avenues, calls for bold, innovative responses. Our blend of ‘rate for risk’ and Open Banking checks mark a pivotal leap towards a retail finance model that benefits both merchants and consumers. As we move forward, our commitment is to deliver reliable, responsible, and inclusive financing solutions that respect the diverse financial backgrounds of shoppers.