The hunt for digital-banking benchmarks

One measure with broad acceptance is ROI, short for return on investment, which gauges the financial success of a particular investment initiative, comparing its financial return to its financial cost. It’s calculated by dividing the net profit of a project by its total expense. 

For some organizations, this measure is too broad because it may “reflect expenses that aren’t consistently impacted by, or substantially supportive to, the project under review,” says Dmitry Voronenko, CEO and co-founder of digital-banking tech maker TurnKey Lender. To skirt this problem, many businesses look to KPIs, or key performance indicators. These are metrics the organization considers vital to achieving its goals, derived from applying ROI calculations to the expense of specific business functions that contribute to (or are impacted by) the project in question. In short, adds Voronenko, “the KPIs of a project are business-specific values that provide a sharper measure of how successful a company is in reaching its strategic objectives rather than ROI alone.” 

But first, wanted to check if you (or your staff) would like this case study of how TurnKey Lender helped National Iron Bank transform their commercial lending process.

What’s the main value of KPIs? For most executives, its value is in supporting (and helping to shape) vital business objectives. It’s also important for managing staff performance and strengthening employee morale. KPIs help executives understand what’s “working” and what isn’t as aid to making strategic and tactical adjustments as needed, potentially shaping factors such as resource allocation and hiring plans . 

Examples of KPIs tracked by banks include everything from revenue, expenses and operating profit to findings around sales, profits and assets under management on a per-employee basis.

In fact though, the number of KPIs is virtually limitless — especially for retail banks, which can engender hundreds of key indicators linked to the impact of expenses, investments, cash flows, debt, and customer service. For many bankers struggling to find ways to measure the success of newly popular digital-banking services, the sheer number of considerations may obscure the view.

Success metrics for online banking 

To help them out of this predicament, here are 10 KPIs banks can use to help them measure the effectiveness of their digital offerings. 

1. Functionality. Banking applications should enable anything that can be done in person at a branch. KPIs for apps shed light on what works and doesn’t in online interfaces. 
2. Activity. Tracking — whether daily, weekly or monthly — how customers use a platform can lead to user-experience improvements and positive word-of-mouth.
3. Retention. Of course happily engaged digital-banking customers are also apt to stick around. Your retention rate for digital customers — measured by return business or satisfaction scores from surveys — can tell a tale of engagement over longer periods than measures of activity can usually convey 
4. Net Promoter Score. Another, arguably wonkier, way to measure long-term growth of your digital-banking operations is an NPS, a way to understand how many of your customers aren’t just happy, but likely to promote services they enjoy to friends and family members. Typically gleaned from surveys, an NPS can help banks understand what it takes to turn customers into active promoters. 
5. Lead Generation. Do your online banking applications introduce customers of one digital service to up- and cross-selling opportunities? Banks with apps that don’t readily introduce customers to ancillary services may be losing business to other providers. 
6. Launch and load times. How long does it take your online-banking apps to load at different times of day, especially during peak hours? Ideally, the interval between click and engagement is brief. Online banking customers are notoriously impatient. Unusually, this is a KPI you can measure with a stopwatch. 
7. Task completion. This is another user-experience metric that measures the rate at which a digital-banking app accomplishes what it’s supposed to for customers. As a KPI, this is a measure of an app’s user-friendliness and ability to deliver. 
8. Abandonment. This is the flip side of task completion. Slow and unintuitive apps can drive customers away before they’ve finished what they set out to accomplish — apply for a loan, say, or add a new payee. In turn this can create not “net promoters” but active “net detractors.” Just as practically, this KPI can point to services design or technology flaws in need of immediate redress. 
9. Preference. Understanding how customers feel about online banking as opposed to in-person banking can point the way to more effective communication strategies that take such preferences into account when promoting new or unused services. 
10. ROI. We’ve already touched on this KPI, but it bears repeating. Anything that sheds light on how expense relates to returns from digital banking will tell a tale of comparative engagement. Here, a relative lack of engagement may hint at customer frustration and a need for better apps, not, as it may be tempting to conclude, a lack of interest in digital banking itself. 

“Each KPI should be judged on the merits of the insights it brings,” says TurnKey Lender’s Voronenko. They don’t apply in every digital-banking situation, and your bank or credit union may refer to some that other institutions wouldn’t even consider.”

The overriding point is that KPIs can help banks understand the value of their digital services, according to Voronenko. “And I would add this,” he says. “KPIs have an interesting habit of creating learning cultures grounded in a willingness to test assumptions, challenge norms, and make sure outcomes are net positive for customers, in a pandemic or not.”

Lending business KPI tracking in TurnKey Lender

TurnKey Lender offers integrated end-to-end solutions for crediting and banking processes automation. The system uses machine learning algorithms to collect, process and presents all of the important business performance indicators at a glance in the Reporting workplace. One dashboard lets you get a working understanding of the business’ well-being, analyze the current effectiveness of staff efforts, as well as explore aggregated assets and current portfolio state.

Plus, with the remote work trend being the new normal, it’s critical to be able to clearly see your staff’s performance. The built-in KPI tracking functionality lets you instantly outperform the competitors in terms of quality and accuracy of insights you get about your originators, underwriters, as well as servicing and collateral officers. The evaluation of each employee’s productivity is based on their responsibilities, taking into account numerous relevant factors, and then uses AI to process, cross-reference, and present the data to the lender.

TurnKey Lender’s intelligent SaaS provides you with both a real-time and historical insight into the performance of your lending business. Schedule a personalized demo to see how TurnKey Lender can help your business grow.

This is where artificial intelligence comes in as an adjunct, and a catalyst, to alternative scoring. To explain how this works, let’s step back for a moment and look at traditional scoring methods and their underpinnings.

Character versus credit score

In fact, there are at least two “traditions” in play here. 

Before the 1990s, assessing a retail loan involved a bank-based loan officer determining the applicant’s creditworthiness based on inputs such as income, indebtedness, prior-credit outcomes, bank balances, work history — and, to no small extent, “character.” Here character would be determined by a range of assessments from the quasi concrete (like the applicant’s prior dealings with the lender) to the relatively ephemeral (like the “standing” in the community). 

In other words, old-school inputs might suggest an applicant is good for the loan she sought in terms of her financial and employment standing, but the loan officer may not like something else about her. Maybe the trigger for rejecting her application, or imposing a higher interest rate,  was a particular character fault — the applicant’s notoriety as a boozer, for example — or maybe it was something frankly discriminatory such as her race, name, neighborhood, accent, or appearance.

By the late 1980s, however, lenders had hit on the concept of credit scores as a transparent alternative to making subjective value judgments about credit applicants, both in the name of fair lending and operational efficiency. To meet this nascent demand, FICO began compiling information on the financial behavior of individual consumers as determined by credit bureaus such as Experian, EquiFax, and TransUnion, and selling these scores to lenders. In time, the big three credit bureaus rolled out rival gauges to the FICO score, but the original remains the industry standard.

A new world of credit scoring

But FICO and other scores based on credit-bureau data form an incomplete picture of a loan applicant.  Borrower traits such as line-item spending habits, social-media comportment, and behavioral “tells” regarding financial obligations shed light in new corners. 

Along these lines, “psychometrics,” a branch of psychology for evaluating a person’s state of mind, is a fascinating new contributor to credit scoring. Applied to lending — and as an illustration of how granular alternative scoring can get — psychometrics show up in borrower traits such as:

• Self-esteem
• Confidence
• Honesty
• Familial relations
• Punctuality
• Responsibility
• Trustworthiness
• Money management and financial planning skills
• Risk aversion
• Organizational skills
• Consistency
• Mental agility

Coupled with additional insights into the applicant’s education level and personal savings and investments, these new data give lenders a sharper sense of the applicant’s ability to repay, and — writ large — a base on which to construct more durable loan portfolios.

The difference between a deluge and a credit score

Making sense of new inputs for credit scoring isn’t easy, however. Aside from raw computing power, it requires sophisticated artificial intelligence (in turn animated by dynamic machine learning) to rationalize an array of data from different sources to form a cohesive and legible internal credit-scoring system.

“With an applicant’s permission, our technology leverages information taken from bank accounts, retirement holdings and other transaction-rich sources to divulge spending habits, and monitor employment and non-employment income for a clearer picture of the would-be borrower,” says Elena Ionenko, a co-founder of lending-technology maker TurnKey Lender. “And because our perspective is global, we know that arming lenders with rationalized alternative scoring inputs equips them to thrive, even in markets where traditional scoring is either rudimentary or nonexistent.”

For instance, adds Ionenko, “Alternative scoring uncover hidden risks such as an applicant’s gambling expenditures or overdraft durations, and use them to make informed credit decisions.”

TurnKey Lender’s credit-scoring functionality, which combines traditional and alternative approaches, allows for dynamic customization. As a result, it answers the credit-assessment needs of mainstream lenders — such as banks, credit unions and finance companies — as well as new entrants. This growing list includes retailers of all sizes and types, medical practices, governmental agencies, NGOs, and invoice financiers.

Alternative credit scoring as a contributor to recovery

Now, with Covid and war pressing on economies, the importance of credit as a tool for rebuilding has come into sharp relief — along with the need for alternative-scoring approaches for lenders.

In the US right now, lending activity is centered on businesses, largely with a view to maintaining worker headcount by means of the Small Business Administration’s “Paycheck Protection Program” and other initiatives run by or for the federal government. Uniquely, government-backed PPP  lending is triggered not by creditworthiness, but a combination of need and the borrower’s ability to find a traditional lender willing to administer the low-interest loan.

Glaringly, however, there are no measures in place to speed the wheels of consumer lending — even though a full economic recovery is unlikely without such a kickstart. After all, the pandemic has eroded the credit standing of many who have lost jobs or seen wages cut. Getting money to borrowers in need these days will call for new ways of evaluating the creditworthiness of consumers.

“In these times, there is no way to exaggerate the importance of secure, reliable and intelligent scoring for lenders of all kinds,” says TurnKey Lender’s Ionenko. “The importance and utility of traditional credit-scoring is unassailable, but there is an acute need now for alternative approaches that lead to better decisions and, in turn, support more robust portfolios.” 

How TurnKey Lender factors in

Since the founding moment, TurnKey Lender team understood that in order to transform the lending industry in a meaningful way, we need to apply AI and Big Data to credit processing and risk assessment. That is why the core team included a department of PhDs and Artificial Intelligence experts that have done successful scoring projects for Fortune 500 companies. And while many traditional lenders were hesitant about making the jump to the new type of intelligent credit decisioning before the 2020 crisis, now the need to adapt to the borrowers’ demands is obvious and even unavoidable if they want to stay in business.

To achieve an unmatched level of credit decisioning accuracy, we use deep neural networks with self-learning scoring models based on both traditional and alternative evaluation approaches and data sources. Working with the clients’ data, the system learns to use prediction, classification, clustering, and association to process loan applications.  

For safety purposes, the system doesn’t just use the data the client is providing but also pulls the available information from the sources it’s synchronized with (like the credit bureaus, bank statement providers, borrower’s smartphone, or social media). All the data is processed by TurnKey Lender’s intelligent Decision Engine and is then presented in the form of a risk evaluation.  

All in all, risk assessment, borrower evaluation, and credit decisioning take our solution as little as 30 seconds. To draw a comparison, most traditional lenders can take up to 9 business days to complete this process.  

Let TurnKey Lender’s intelligent software analyze millions of data points in a matter of seconds while you grow your business.

But AI and Big Data, no matter how advanced and sophisticated, don’t bring much to the table unless they process the right borrower data. TurnKey Lender team analyzed the operations and credit decisioning flows of our clients in 50+ countries and dozens of business verticals to come up with optimal scoring models and decision rules that help weed out unreliable borrowers and pre-approve the loans that are most likely to be paid off on time. Not to mention, the dynamic selection and assignment of fitting credit terms to each application.

With all the heavy lifting done by the system, the employees’ time and energy are freed up to focus on business development and customer relations which translates into better performance.

TurnKey Lender Decision Engine comes with a proprietary AI-driven scoring model and decision rules built-in. Both are fully configurable, allowing you to set the factors you want to evaluate and assign values to them, based on what is more important for your operation.  For cases when there’s no sufficient data available to evaluate borrowers, you can use a dedicated TurnKey Lender Psychometrics app that evaluates the borrower’s smartphone data and behavior patterns.

At the same time, to make sure we leave no stone unturned, TurnKey Lender provides lenders with an option to also collect and process traditional data like credit bureau reports, bank account statements, and payment data.

Data from traditional and alternative sources goes through the TurnKey Lender Decision Engine which in turn analyzes it with machine learning algorithms and deep neural networks. Pre-configured integrations with 75+ relevant data sources and technology providers allow lenders to put their entire decisioning workflow on autopilot and focus on big picture things.

Interested in learning more? Schedule a call with one of our experts today!

And of course that was before the coronavirus pandemic shredded short- and medium-term financial forecasts for businesses and households alike. We’ve also collected the five key reasons to consider POS financing for retailers in a recent blog post.

“If anything, retailers and other product and service providers are keener now than they were pre-Covid to attract customers and encourage sales by providing quick, low-risk installment loans to fund purchases — and not just on big-ticket items,” says Elena Ionenko, co-founder and business-development head of loan-servicing software maker TurnKey Lender. “That said, businesses considering adding POS-purchasing options should take a strategic approach, one that presupposes some familiarity with the different business models that can support such lending.”

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All the reasons why

Besides the spur of shutdowns this year, the recent rise in POS financing is attributable to several principal factors, according to Ionenko.

• Public awareness: As mentioned, consumers and retailers are gaining awareness of the financing possibilities of POS, especially for goods with large and mid-level price tags.
• Convenience: Loan applications are processed prior to actual sales, either at the checkout using a mobile device, or as a quick preliminary step in making online purchases.
• Fintech innovation: Publishers of POS-financing software have streamlined origination and other processes by means of artificial intelligence, dynamic evaluation models, and automated oversight and management features.
• Credit-Card fatigue: Young consumers (many struggling to repay student loans) tend to be more suspicious and hostile toward credit cards than their elders.

But, adds Ionenko, just as would-be lenders should understand the catalysts for the rise of POS financing, they should be conversant with the five main business models that underpin retail and other business approaches to this form of lending. Those are:

1. Balance-sheet rental. In this model, the POS financier partners with an established lender — usually a bank or a fintech — to originate loans. This is often the cheapest option, but it provides limited access to customers through the life of the loan, making it less user friendly in the most fundamental sense.
2. Joining an “ecosystem.” In this version, the POS sponsor — whether its a retailer, a car lot, or a medical practice — taps into an online marketplace featuring multiple firms with experience in POS lending, This version tends to yield more control over approval criteria, higher approval rates, and less “integration fatigue” — again though, post-approval touchpoints with customers may be limited.
3. Credit-card program innovation. Remember the credit-card fatigue we mentioned earlier? Another wrinkle on outsourcing to support POS financing depends on working with a card issuer to carve out lower-interest installment loans for existing card accounts as a way to attract more installment buyers.
4. Going all-in. This one is far-fetched for most businesses that aren’t already, say, banks. The idea is to become a fintech in one’s own right — an undertaking that calls for considerable technological — and probably tech-marketing — know-how.
5. Renting the technology. Businesses can subscribe to pre-existing POS-lending platforms, sparing themselves the toil and expense of investing in proprietary lending infrastructure. The rub here is finding the right technology partner.

The case for renting

For Ionenko, renting the tech — that is, going for an in-house POS solution enabled by a specialist lending-platform provider makes the most sense. Among the advantages she cites:

• Better data integrity and security. Client data is kept between your business and its customers with no third-party involvement. This enhances confidentiality — a boon to many businesses, including medical practices. This also diminishes the risk of customers getting poached by competitors introduced to them by third-party lenders.
• Higher conversion rates. For customers, an in-house solution backed by a dedicated lending-tech maker can make the process of applying for and securing a POS loan nearly as fast and easy as making a payment at a cash register — an innovation that reduces purchase abandonment.
• Proprietary underwriting. If a business wants to set its own criteria for credit decisions, and wants to provide more flexibility around approvals, in-house rules can help ensure that its interest rates are calibrated to balance policies and risk aversion with profitability and enhanced customer relations.
• Access to transactional data to increase fast and smart decisions through artificial intelligence, and to optimize portfolio yield with technology that helps retailers the business identify profitable customers for more favorable terms or other relationship-building incentives.
• Reducing (or eliminating) transaction fees otherwise payable to a third-party lender (which can be as high as 15%).Secure, encrypted apps ensure safe functionality at any location there’s wifi or mobile-data availability.
• Improved brand loyalty. With fully-supported white-label technology, a business doesn’t have to worry about its customers getting confused by third-party documentation — or losing such a vital touch point to make inroads in long-term relationship building.

“Retailers remain under acute pressure from the coronavirus pandemic and measures taken to prevent its spread against a darkening economic backdrop,” says TurnKey Lender’s Ionenko. “Giving customers a choice to fund purchases over time through POS installment financing can reduce ticket shock, build loyalty and help close sales.”

TurnKey Lender solution for retailers

TurnKey Lender’s Retail Solution allows anyone to provide instant financing to customers to quickly grow new business. With an intuitive user interface and a proprietary AI-powered Decision Engine, you get the lowest possible credit risks with the biggest potential growth spread.

The cloud-based platform incorporates retailers’ order processing automation, flexible business logic, and customer portal in a single, integrated solution. The entire financing process is 100% automated.

• Customers apply from your website or an in-store kiosk.
• The Platform automatically pulls customer data from credit bureaus, bank statements, and other sources, and suggests a credit decision based on your unique business rules.
• The system either automatically decisions the financing or presents it to your underwriter for review.
• Funds are sent to the vendor once the transaction is complete and the financing is executed.
• The Customer Portal allows customers to easily manage existing financing, make payments, submit documents, track statuses, and apply for additional financing without reentering their data.

Businesses in over 50 countries use TurnKey Lender to:

• Grow their customers’ lifetime value and stand out from competitors with affordable and easy-to-use financing options. 
• Have an unmatched time-to-market for any new promo campaigns or financing options.
• Increase the average order size while offering competitive rates.
• Stabilize cash flow to account for retail seasonality.
• Build customer loyalty and ensure repeat business.

In preparing to implement POS financing, however, Ionenko concludes that “businesses should ask themselves if they’re better served by outsourcing the program, or engaging a lending-tech vendor with a view to retaining more control of its customer-centric purchases options.”

If you would like to discuss how to add embedding digital lending into your operation, don’t hesitate to reach out to our team at sales@turnkey-lender.com and our team will be happy to answer any and all of your questions!

Just weeks after the World Health Organization declared the coronavirus pandemic in March 2020, businesses began accelerating uptake of hardware as well as conferencing and work-sharing software to support employees suddenly required to work from home. Meanwhile, consumer- and business-facing enterprises sped up plans for payment methods — and in many cases, in-house financing tools — conducive to social distancing, and dependent on digitalization. 

Covid was more of a spotlight than a catalyst  

“It’s unlikely we’ll ever untangle the mystery of which technological innovations came to the fore because of Covid and which were in line for prominence anyway, but it’s possible digitalization falls into both categories,” says Dmitry Voronenko, CEO of lending-technology pioneer TurnKey Lender. “Interest in using digital technologies to enhance entire business models, augment value, and provide new revenue streams has been accelerated by the pandemic, and it remains an inevitable part of a fast-maturing ‘internet of things’ in a post-Covid business landscape.” 

In this article, we’ll mine research firm Gartner’s recent intelligence on new technologies and business rationales central to trends in financial technology, and especially lending tech. Our purpose here is to help owners and executives put recent and impending developments in financing technology in a sharper perspective — and help them understand why, as Gartner asserts, 57% “of financial services firms see technology giants or fintech startups as a major threat to the industry.” Only 49% of these firms pointed to traditional competitors as “major threats.”  

To start, let’s examine some of Gartner’s most arresting predictions linked to the rise of nimble new financing technologies. The firm says that: 

• By 2025,  at least 40% of customer-facing staff will engage with external ecosystems directly to support client preferences and service their banking needs 
• By 2023, 25% of automation business cases will fail because they are based on staff reduction rather than customer satisfaction or new revenue 
• By 2025, more than 50% of financial services supporting vendors will offer no-code or low-code tools to enable non-IT employees 

In addition to these marquee predictions, Gartner sees the following developments playing out with reference to smart, tech-enabled financing. 

Traditional lending will die out  

With interest rates at or under zero around the world, banks are struggling to make any money at all from lending. Hard-pressed to achieve every scrap of efficiency they can muster, these institutions are looking to digitalize every stage and aspect of lending, from application to the loan’s retirement. 

Centralization will increase 

Banks whose core systems have tracked consumer behavior for at least 10 years have found that 80% of their customers use 20% of their defined products, adding weight to the argument that localized functionality should be eliminated where not required, and externalized from the core as needed. 

Digitalization will add revenue 

With a view to accelerating digitalization, and generating new revenue by providing technology services to external customers, 10% of large traditional companies will have established in-house tech businesses by 2022. It’s not hard to imagine that retailers and B2B players will lead the way toward in-house digital lending in a bid to add sales and increase efficiency.   

Artificial intelligence will get more granular 

Artificial intelligence isn’t science fiction anymore; it’s a pragmatic toolset for achieving specific strategic outcomes. Among businesses surveyed by Gartner, the main drivers for adopting AI are: 

• Improving customer service/experience – 43% 
• Increasing efficiency – 24% 
• Improving risk management – 19%  (up from 7% in early 2020) 
• Reducing cost – 8% 

Another big jump occurred in uptake around “intelligent applications”– apps primed to learn — which went from 1% of new AI engagement to 7% in 2021.  

Key to broader uptake of AI by banks is public confidence in these institutions. In 2019, Gartner found 67% of consumers trust banks to keep their personal data secure. For comparison, only 19% insurance companies enjoyed such confidence among consumers. 

Returning to risk for a moment, the top risk-management applications for AI are: 

• Anti-money laundering 
• Fraud management 
• Customer churn prediction/prevention 
• Credit scoring 
• Mortgage default production 
• Threat detection and forensics 
• Portfolio credit risk optimization 

Learn how TurnKey Lender uses AI in lending automation.

AI will become more “democratized”

Generally, the public’s understanding of AI is improving — perhaps even undergoing a process of “democratization,” resulting in more minds concentrated on its potential, and more demand for AI in work-related processes. As Gartner puts it, “Democratization of AI means that AI is no longer the exclusive preserve of data scientists and AI professionals.”  

Increasingly, organizations lacking in-house expertise have access to cloud-based teaching kits, AI marketplaces, and turnkey programs to make AI available to them in digestible bites. “Most of these technologies have ‘high’ impact and mass, meaning their adoption will affect many verticals and transform business processes,” says Gartner. 

Varying types of machine learning will proliferate 

Meanwhile, “machine learning” — “computer algorithms that improve automatically through experience and by the use of data,” — remains the dominant AI-related technology, says Gartner. But the firm sees subdivisions emerging from the broad ML category. Its three parts are:  

• Now-dominant supervised learning, in which observations contain input/output pairs of “labeled data” 
• Unsupervised learning, in which labels are omitted 
• Reinforcement learning, which provides qualitative assessments of how good or bad a given situation is 

To take advantage of the emergence of AI as a commercial force, Gartner recommends that banks eager to extend credit to consumers: 

• Convert lending activities into financing activities and projects 
• Replace the revenue from interest rates with a new revenue stream from new services 
• Increase commission income 

“This applies as well to other businesses that traditionally extend credit — anything from dentists and eye doctors to heavy-equipment manufacturers, trade-loan brokers, and hardware stores,” says TurnKey Lender’s Voronenko. “Everything they need to make secure, bank-grade financing a 100% in-house offering is on the market today, ready for them to sign on and start giving their customers a twenty-first-century experience.” 

Reach out and schedule a personalized TurnKey Lender demo to start your intelligence-driven digital lending journey today.

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For many homeowners, a tactical approach to debt is vital to making home improvements affordable. After all, the total outlay for materials and labor needed for installing new siding, extending a deck, or adding a new bathroom can impede a family’s ability to meet other financial obligations. Without financing, many home-improvement projects must be delayed — sometimes forever. 

So it’s important that contractors understand and be able to explain the options their customers have when it comes to financing their home renovations. Refinancing a mortgage or securing a home-equity line of credit may seem the default source of credit for home improvements, but it isn’t the only option, or necessarily the most effective form of credit for the task at hand.  

Here’s why you should rethink how you facilitate financing  

“The right kind of financing can help homeowners achieve their dreams without ‘breaking the bank,’” says Elena Ionenko, co-founder and operations chief at TurnKey Lender, a leading lending-technology provider. “Contracting businesses that can provide options for financing are helping them seize opportunities — whether the opportunities stem from better interest rates, favorable pricing for materials, or a need to complete work on a particular timeline.” 

There’s a reason consumer-oriented building-supply chains like Home Depot and Menards provide branded financing options to consumers, typically in the form of project loans extended and administered by third-party financiers. Simply, it attracts customers who in turn buy their wares and use their subcontracting businesses — customers who might otherwise hesitate to greenlight a home-improvement project.  

And it’s absolutely worth the effort. Contractors and subcontractors who can help consumers over financing hurdles are angling for an ever-bigger share of a global home-improvement market valued at $849.3 billion in 2019, and expected to top $1.4 trillion by 2026, according to Brandessence Market Research. 

Before providing a run-down on the most dynamic way to help homeowners by providing point-of-sale financing, let’s consider how most consumers secure funding for home-improvement projects right now. 

• Credit card(s) 

This method has the attraction of simplicity, but you may need to be approved for higher credit limits on the card — or use several cards to get the job done. On the downside, notoriously, is the fact that credit-card rates are high, reflecting the fact that they’re unsecured. That said, some cards offer 0% introductory rates for up to 18 months. If you can pay it all off in the stated introductory period, it can be both a cheap and easy way to secure funds for making home improvements. If you can’t, you could end up regretting the lure of plastic. 

• Cash-out refinancing 

This calls for refinancing to a new mortgage, resulting in a larger debt than what you have currently. You then pay off the old mortgage, and use excess funds for the home renovations in view — if you like. In effect, the “ready cash” from the refi comes from the home equity you’ve accrued in paying down the first mortgage. This can be an effective technique when you can secure a lower rate of interest, and can allow you to pay off the remaining mortgage more quickly. One thing to know: there will be closing costs, and they will be applied to the whole mortgage amount, not just the funds freed up for home improvement. 

• Home-equity loan 

This is a loan against the free-and-clear equity you’ve already purchased in your home in the course of paying down a mortgage. This fixed-rate option for funding improvements works best for homeowners who have already built up substantial equity, and wish to make use of that money for large renovations — enough to make the closing costs worthwhile. When secured against a property that has been paid down considerably, lower rates may be available. Interest payments on a home-equity loan (HEL) may also be deductible from taxes. 

• Home-equity line of credit 

If you can liken a HEL to a mini-mortgage, a home-equity line of credit, or HELOC, functions much like a credit card: you borrow up to a pre-agreed limit, pay it back (all or in part), and have access to the remaining loan balance — which, of course, has to be repaid. Rates are adjustable, but they are only applied to amounts actually borrowed, not the entire limit. Closing costs on HELOCs tend to be nominal. 

• FHA 203(k) “rehab” loan 

New homeowners looking to finance renovations while securing a first mortgage may be interested in this approach, especially if they have a fixer-upper on their hands. These government-backed loans typically come with lower down payments (as low as 3.5%), and lenders tend to be less strict when it comes to credit scoring — a score of 620 should do the trick. That said, funds derived from an FHA loan must be used for home improvements, period. 

• Personal loan 

Besides credit cards, a personal loan may be attractive to homeowners who can’t draw on equity or provide substantial collateral. These can have high fixed or adjustable rates, flexible (but pre-agreed) repayment periods, and they usually come through pretty quickly. They frequently come into play in emergencies — say, to replace a heating system in the dead of winter. 

But there’s another way to extend credit to homeowners looking for your help to improve their homes: you can be the bank.  

A new wrinkle on point-of-sale financing 

If big-box home-improvement stores don’t use this method (yet) it’s because they’re behind the curve. It’s likely they put in place their point-of-sale financing a decade ago, and since then lending tech and artificial intelligence have advanced to the point where you can operate a secure, efficient and easy-to-use lending platform from a smartphone in the cab of a pickup.  

Back in 2010, engaging with a third-party lender, which worked behind the scenes to score, approve, fund, and service loans to make renovations, was just about the only way to go. “Recent advances in financial technology have been stunning,” says TurnKey Lender’s Ionenko. “Our financing platform can be configured to the exact needs of a particular contracting business, and it links to any third-party system software for seamless integration.” 

TurnKey lender’s end-to-end automation can be used for home-improvement financing including loan origination, servicing, management, and collection – all within an intelligent integrated solution. Among other benefits to this approach are lightning-fast, AI-aided approvals — a matter of minutes versus days for other types of financing.  

In addition to being able to meet your customers’ financing needs, having from-anywhere access to best-in-class means with upgrades provided as they’re developed and approved — and you split financing fees, which you set, with no one. 

“What we’re doing for point-of-sale financing is part of a broader fintech revolution that’s changing how we buy, how we invest, and how we get funding where it’s needed,” says Ionenko. “Our solution helps contractors increase sales while helping their customers finance their home improvements in the most straightforward way — a fact that comes into sharp focus for consumers who understand their other, not always so attractive, financing options.” 

Sometimes we get variations on this sensible question from capital-equipment makers and distributors, so we’d like to give it the attention it deserves.  

Businesses of all sizes and kinds have long used credit cards to fund equipment purchases. After all, they’re as close by, in theory, as your purse or pocket, and sometimes come with low introductory fees and the added attraction of points. Cards can also be a faster way to secure equipment than waiting for bank loans to clear — and if they come at higher interest rates than most other financing methods, that’s not likely to be a problem where cash flow is steady and plentiful. 

Still, businesses that rely on cards to fund large equipment acquisitions are leaving on the table significant advantages that are inherent to financing purchases through a supplier’s in-house program. Here are the six biggest advantages. 

1. Keeping other lines of credit free and clear

Tapping into an equipment provider’s financing means that other, often more expensive, lines of credit are ready for times when working capital may be in short supply. In fact, injudicious use of funding sources such as credit lines and bank loans can even create capital shortfalls. Imagine a business needs a piece of equipment but lacks the wherewithal to purchase it outright. They could apply for a term loan from a bank to fund the purchase of machinery they need. But what if there’s a business interruption, and servicing the loan becomes difficult? Or if a credit card is used, and business slows to the point where repayments get onerous?

“Slip-ups at such times could trigger higher rates, and still more difficulty staying current on debt,” says lending-technology pioneer Dmitry Voronenko, CEO of TurnKey Lender. “Where in-house financing is in play, a business that experiences a shortage of capital can then apply for a bank loan or use a credit card.” Meanwhile, with the financed equipment as the collateral for the financing, the business is free to collateralize other effects to secure additional loans if and as needed. 

2. Getting out there with the finest equipment available 

Servicing a capital-gear purchase with a credit card can make it harder to secure best-in-breed equipment. For businesses whose competitive edge is linked to using the best proven new technologies, upfront costs can be discouraging — to the point where some businesses in this predicament start using older gear that’s likelier to break down and takes longer to do its job. Simply,  financing equipment through a manufacturer’s or distributor’s in-house offering — again with the collateral largely built-in — makes the newest proven tools and tech readily attainable.  

3. Maximizing working-capital flow in spite of seasonality 

To the extent businesses are vulnerable to seasonality, so is their cash flow vulnerable to depletion. Even where seasonality isn’t a yearly issue, almost every business experiences cash flow shortages from time to time, for one reason or another. At such times, equipment financing, with repayments coming in steady increments, can free your customers to deploy cash in support of other operating expenses.  

4. Leveraging the tax code viz. interest payments on financing 

The interest a business pays on a financing arrangement is tax-deductible. Where leasing arrangements are available, a business securing capital equipment may be able to deduct the entire lease payment as a business expense, not just the interest portion. Another tax benefit accrues from Section 179 of the IRS Tax Code, which may allow a business to deduct the full amount of a multi-year lease in the first year. 

 5. Applying for financing is simple and quick  

Typically, the application for financing orders that cost up to $200,000 can be completed and — if green-lighted — funded in minutes where the supplier’s financing program is digitalized; a day or two otherwise. 

“Financing decisions around these so-called small-ticket items typically come down to the type and value of the equipment in play, and the credit quality of the applicant,” says TurnKey Lender’s Voronenko. “Businesses with strong track records or whose principals have good credit standing can expect quick turnarounds on financing.” Orders valued higher than $200,000 the process can be more complicated, require more inputs from the applicant, and take up to a week to process — unless the financing platform is digitalized. In that case, the turnaround can be a matter, once again, of just a few minutes. 

 6. Benefiting from a digitalized financing environment 

New technologies let equipment makers and distributors employ smarter credit scoring. Just as e-commerce has evolved to be more consumer-friendly, so has “lending tech” become much more dynamic in the last decade or so — just in time, in fact, for the restrictions imposed by the coronavirus pandemic, some quite likely to be permanent. In this equation, artificial intelligence functions as an adjunct, and a catalyst, to alternative scoring. Instead of relying mainly on FICO scores generated by credit bureaus and biographical data, financiers with the newest lending tech can tap into alternative scoring that leverages permission-based inputs around spending habits and social-media comportment to arrive at a fuller picture of your company’s ability to meet its obligations. New and established companies alike can get faster decisions — and quite likely better terms — from such alternative credit assessments. 

“It’s hard to overstate the importance of fast, smart and dynamic scoring, processing, and servicing for companies in need of capital-equipment financing that promotes cash-flow consistency and leaves other financing sources available for true emergencies,” says Voronenko. “It’s what equipment suppliers and purchasers are starting to demand.” 

Ready to start growing your business by offering affordable and easily accessible financing to your clients? Schedule a personalized TurnKey Lender demo today.

As a business owner or executive, you may pride yourself on knowing your customers’ needs and preferences, and providing the kind of service they want and need. But, however comfortable, friendly, and in-tune you may be with your customers, you’re probably up against competitors who can help your customers through cash-flow dry spells by means of invoice financing. Meanwhile, those of your customers who find themselves with cash-flow constraints stemming from billing-cycle issues are left to struggle to compete with firms that, for one reason or another, enjoy deeper capital reserves. 

Until you can provide invoice financing to them, neither your company nor your customers are competing on an even field, and whether you know it or not, you’re probably losing business as a result. 

SMEs are engines of growth for invoice financing (and vice versa), come what may 

Strength and relative stability in the US stock market since mid 2012 has proved a boon to many businesses, pushing invoice factoring to the sidelines as bigger companies take advantage of easy access to bank-originated lines of credit. At the same time the largest publicly-traded companies look first to internal resources to bridge cash-flow gaps. As a result, the invoice-factoring market grew just 0.4% between 2015 and 2021, says IBISWorld. 

What comes next for the space is anyone’s guess, says Dmitry Voronenko, a lending-technology pioneer and CEO of TurnKey Lender. “For traded companies, the possibility of buoyant corporate profits may keep a lid on dramatic growth for invoice financing through 2025 — unless impacts of the coronavirus pandemic put pressure on those outcomes,” he explains. “But invoice factoring is likely to grow in importance for small and mid-size enterprises no matter what the stock market or the broad economy does in the next few years.” 

Besides helping your B2B customers, providing payment options that include invoice financing as a form of short-term borrowing collateralized by their accounts receivable, can be at least as beneficial to your company. Here are five ways this happens. 

1. Expense control

You have your own bills to pay as well. If you have to wait until your customers pay the invoices you issue, you may get jammed up with your own vendors, triggering additional interest charges and late fees. Getting paid via invoice financing means your own cash flow remains steady, allowing you to meet your obligations to your vendors, lenders, and other businesses your enterprise relies on. 

 2. Better credit rating 

Again, invoice financing improves the consistency of cash flow — and that goes for you as much as for your business customers. In turn, your ability to meet your expenses as they arise translate to an improved credit score for your business, and, in some circumstances, for you personally. 

3. Leverage 

Having cash on hand means you can “afford” to wrangle for better terms, and take advantage of discounts for paying in cash or buying in bulk. 

4. Credit-risk reduction 

Whether you employ a factoring company or use software to do it in-house, the credit checks on your company’s customers provide decreases the risk of default. 

5. Lower overhead 

Not least, invoice factoring streamlines the process and reduces the time, money, and work-hours associated with old-school approaches to generating, tracking, and receiving payments. 

While invoice-factoring companies — some of them attached to big-name banks — provide an outsourced option for companies, cloud-based options that balance ease of use with advanced functionality have come to fore in recent years.

Among the benefits of this in-house software approach to invoice factoring are: 

• Intuitive functionality that’s accessible anywhere there’s an internet connection 
• Artificial intelligence that powers advanced credit-scoring and ensures applications are processed in seconds 
• Credit-scoring backed by machine learning further reduces credit risk 
• Alternative credit-scoring options make sure no low-risk customers are overlooked 
• Deep configurability without having to change any source coding  
• White-labeling to maintain branding internally and externally 
• Preconfigured and API-enabled integrations for frictionless processes automation
• Automated debt collection processes for scalability 
• Distinct work interfaces for different employee and manager types 

Ability to save on fees that would otherwise go to an outsourced (as opposed to cloud-based) invoice-factoring processor — which could amount to 3% or more in addition to financing fees. 

“We’re getting past the point where the cloud-based approach to invoice factoring is superseding traditional third-party approaches,” says TurnKey Lender’s Voronenko. “It’s not just that our approach is faster, more reliable, and characterized by more consistent outcomes. It’s that we train and support our customers’ staff members, and assist with any complex issues that arise.” 

Adds Voronenko: “We don’t make cookie cutters, we make a universal tool for cloud-based lending, leasing, and factoring that’s backed by a rigorously consultative approach, which is in turn based on a thorough understanding of your business needs, challenges, and opportunities.” 

Learn about TurnKey Lender Debt Financing platform and schedule a live demo today.

US companies finance nearly $1 trillion in equipment annually, according to the Equipment Leasing and Finance Association, making it a vital engine for economic growth. Traditionally, the financing companies use to secure the tools and supplies they need to function comes from banks and commercial lenders. While these lenders typically offer the lowest rates of interest, their qualifying requirements are relatively stringent, forcing some companies to consider alternative lenders that tend to charge higher rates. Banks prefer companies that have been in business for at least a year and have credit scores of 650 or more. 

Meanwhile, the coronavirus pandemic is reshaping business and workplace norms. As a result, equipment providers face financial and operational pressures from new economic realities, new regulations, and an accelerated shift toward digital infrastructures in almost every industry. In this environment, equipment providers are scrambling to adapt, meet current demand, and prepare for an anticipated post-Covid recovery. 

A white-label financing platform with best-of-breed technology 

“Fortunately there’s a way capital-equipment makers and dealers can appeal to customers — and not just those who wouldn’t qualify for bank financing — while benefiting themselves,” says Elena Ionenko, co-founder and chief operating officer of TurnKey Lender, a lending-tech provider with customers in more than 50 countries. “Suppliers can provide financing in-house using third-party, cloud-based software that’s flexible, secure, and easy to use.” 

Innovations in financial technology have made secure transactions possible wherever there’s internet connectivity, whether that’s at the checkout counter, online, or at a jobsite. This flexibility, already associated with e-commerce, has become part of the lending landscape as well in recent years, with far-reaching implications for equipment suppliers and the companies they serve in fields as diverse as agriculture, transportation, and medical devices. 

Case Study: Equipment Finance: End-to-End Automation of & Digital Lending In-house

In a nutshell, your companies financing options now include a tech-assisted DIY approach that can save you time and money while enhancing customer relationships and bolstering cross-selling initiatives. 

Instead of leaving your customers to arrange financing on their own, or serving as a conduit to traditional sources of finance, you can deploy a white-label platform with best-of-breed technology — including innovative artificial intelligence and deep-neural learning — that provides instant credit decisioning and automates manual lending processes to streamline every step of customer experience. 

Provide financing decisions in seconds, grow customer value 

With help from smart lending technology, equipment dealers can: 

1. Instantly make decisions on credit applications 
2. Provide flexible lease and loan financing options to suit all customers, with pricing commensurate with the risk associated with particular borrowers 
3. Increase average order size 
4. Flatten income seasonality with installments coming in throughout the year 
5. Update, streamline and automate legacy processes for digital transformation 
6. Reduce, even eliminate, human error and other operational inefficiencies 
7. Easily integrate lending software with any system software in order to centralize lending operations 
8. Earn new lending fees while retaining access to and control over customer and business data 

Further, with cloud-based lending, equipment makers can grow customer lifetime value by: 

• Providing an easy and effortless lending experience with intuitive web and mobile interfaces 
• Enhancing post-financing communications so customers receive regular notices of payments due and other reminders 
• Deploying AI that can provide insights on customer preferences and behaviors for more targeted marketing and special offers 
• Creating custom credit products with just a few clicks 

TurnKey Lender’s cloud-based equipment-financing and asset-leasing platform is a case in point.  The system incorporates the manufacturer’s order-processing automation, business logic, loan management, reporting, and customer portal in an integrated solution, providing manufacturers, distributors, and resellers with bank-grade credit decisioning. 

Flexibility and support for in-house equipment financiers  

With TurnKey Lender, your company can implement equipment-based loan origination in ways best suited to your industry and your company, including rent-to-own, lease-to-own, and value-add incentive programs. Integration of the lending platform with your website and your e-catalog converts your “shopping cart” into a financing platform.  

But don’t you have to be an experienced lender to operate a financing platform? That was true in the past, says Ionenko, but it isn’t the case anymore. “TurnKey Lender takes care of all the time-consuming financing tasks based on configurations that you select, and of course we provide staff training and live support 24/7.” 

This flexibility lets your company consider financing for applicants that might fly under other financiers’ radar. Using inputs like the would-be borrower’s income structure, expenses, and other financial behaviors, as well as traditional considerations such as longevity and credit scores, your company can uncover hidden gems, secure in the knowledge they’ve been analyzed by the industry-leading AI.

In addition, TurnKey Lender comes with integrations and proprietary modules that allow your company to complete processing, underwriting, origination, and disbursement processes in a matter of minutes.  

“The first question you have to ask yourself as an equipment supplier is whether you’re happy with time-consuming and restrictive lending processes that may turn away good clients,” says Ionenko. “If you’re not, there are time-tested and sophisticated financing options in the form of flexible, intuitive, and fully-digitalized platforms, among which TurnKey Lender is an acknowledged leader.” 

Given the overall size of the US market for capital equipment financing — now approaching $2 trillion a year by one estimate — it makes sense a host of banks and non-bank lenders would have crowded into the field, eager to help builders get their hands on the equipment they need to do their jobs at rates they can handle. 

We’ll look at how these financiers generally operate and suggest a surprising alternative for savvy equipment suppliers in the form of tech-enabled in-house financing as an option that could help them trim costs, make money, boost efficiency and enhance the value of their customer relationships. 

Different kinds of borrowing 

Construction-equipment financing refers to loans used to purchase business-related equipment — bulldozers, say, or backhoe loaders. It provides for periodic payments that include interest and principal over a fixed term. This applies to any sort of work-equipment financing, whether the item in question is a pallet of surgical gloves or a jumbo jet.

Though some big-name lenders like Citigroup and Wells Fargo are generalist financiers, many smaller players specialize in particular industries. Some in this category are thought more suitable for the construction equipment, while others cater to companies in search of office equipment, or used gear. Still, others support enterprises that lack credit standing, often because they’re startups. And of course, each is priced according to the risk the financier has to assume. 

There’s another third-party option, however. “A business looking to secure equipment it can’t buy outright may try to secure a business loan or line of credit,” says Elena Ionenko, co-founder and chief operating officer at lending-platform innovator TurnKey Lender.  “But with equipment financing, the equipment itself serves as collateral, making it easier for the lender to repossess the asset should the loan go into default.” 

For borrowers, this makes equipment financing less risky, easier to secure, and generally more cost-effective than securing a loan that isn’t specially earmarked for specific equipment. 

But here’s an important caveat: equipment financiers typically balk at lending more than 80% of the equipment’s cost, leaving borrowers to cover the balance in a substantial down payment. For this reason, some construction companies prefer a third alternative: leasing.   

What your customers are thinking 

Companies typically decide whether to finance or lease based on the following criteria. 

• Obsolescence Capital equipment that quickly wears out or becomes obsolete may be a candidate for leasing — provided the gear isn’t worn out before the lease term expires or there’s contractual provision to keep the lessee from having to keep paying for broken equipment. Lessees also avoid having to worry about disposing of outdated equipment. 
• Timeline and Budget  In the traditional view, if the equipment is needed for more than three years, secure the financing to buy it (if you can’t buy it outright). Although leasing usually offers a change to get up owning the equipment, financing tends to be cheaper. But if the company is planning to buy the equipment once the term of the lease has ended, the company is likely to end up paying more than it would through financing. Leases tend to carry smaller monthly payments than a loan. If you’re operating on a thin profit margin, a lease is worth considering. Be aware that if you are planning on purchasing the equipment at the end of the term, you’ll likely have to pay all or some of the cost of the equipment. This arrangement will probably be more expensive in the long run. 
• Cash-on-hand If a company can’t part with 10% to 20% of the equipment’s value up front, it might have difficulty finding a lender willing to dance. In this case, a lease might be the only alternative. 

Although equipment makers and suppliers must be aware of these considerations, it’s companies looking to secure equipment that need to put them front and center. Equipment suppliers have another choice to grapple with. Namely, should the manufacturer partner with a technology vendor to provide in-house financing, or engage a bank or equipment-purchase lender to provide the financing for your customers? 

Learn about TurnKey Lender Equipment Financing Platform.

Advanced AI in an equipment-financing platform you control 

While the question may differ from supplier to supplier depending on the industry served, points in favor of third-party lenders include: 

• Removes credit risk for the manufacturer 
• Requires less training for employees 
• Results in the equipment maker receiving full payment up front 

Among arguments in favor of equipment suppliers using in-house equipment-financing technology like TurnKey Lender’s to issue financing on their own are: 

• Affordability from the financing platform’s modular structure allows manufacturers to start small and add functionality as needed. It’s anything but one-size-fits-all. 
• Flexible underwriting lets you make credit decisions, and control risks, on your own terms. You can also waive down payments — with such decisions backed by verifiable data. 
• Better portfolio yield from artificial intelligence that lets manufacturers optimize portfolio yield by approving only the customers you want, at optimal risk-adjusted rates. 
• Enhanced customer loyalty from white-label technology so you don’t have to worry about clients getting confused by third-party documentation. 
• Client-data integrity and security ensures customer data isn’t shared with third parties. 
• Business metrics that can help you understand customer behavior and preferences, and design incentive programs accordingly. 
• Staff training and 24/7 IT support and customer service Do you have a question? It gets answered in real-time. 
• Mobile-lending capabilities by means of encrypted apps designed for secure, on-the-spot service. 
• Scalability that lets a financing program grow as the business grows. 
• You keep 100% of the fees No fuss, no muss, and absolutely no split with a bank. 

“The fact that our platform uses advanced AI to support credit decisions, set rates and control risks means our clients have more scope to provide financing for larger financing contracts,” says TurnKey Lender’s Ionenko. “Third-party lenders can cost their clients by rejecting applications that look riskier than they really are — subtleties that third-party generalist lenders may overlook.”  

It also highlights two major business considerations for equipment suppliers. First, they should expect more competition than ever as rivals ramp up to meet unprecedented levels of pent-up demand. Second, and related, they will need to increase efficiency, dexterity, and capacity in their financing operations while enhancing user experiences at every stage of the transaction. 

Business insights previous generations could only dream of 

The specific sectors in play touch most of the economy. In fact, almost 80% of US businesses lease or finance the equipment they need to function and thrive. In this category, the top 12 industries reliant on equipment financing are:  

1. Agricultural equipment 
2. Aircraft and unmanned aerial vehicles (drones) 
3. Business, retail and office equipment 
4. Construction and off-road equipment 
5. IT equipment and software 
6. Manufacturing and industrial machinery  
7. Materials handling  
8. Medical technology and equipment 
9. Mining machinery 
10. Rail cars and rolling stock 
11. Trucks and transportation equipment 
12. Vessels and containers 

Learn about TurnKey Lender Equipment Financing Platform.

Although each industry has special requirements in financing, one cloud-based platform has emerged to meet these diverse needs, characterized by ease of use, broad configurability, compatibility with system software, and ever-smarter technology. 

“The central themes in finance technology for the next decade are coalescing around artificial intelligence,” says Dmitry Voronenko, CEO and co-founder of TurnKey Lender, a lending-tech trailblazer with operations around the world. “Whether you’re talking about faster risk-controlled outcomes, big-data analysis, or better communications with customers, AI — which, coupled with machine learning, confers the ability to make sound inferences from large and varied inputs — is at the core of best-of-breed financing these days.” 

Financing tech for equipment suppliers determined to dig deeper, go farther 

Consulting giant Deloitte agrees. “Sophisticated machine learning models help companies efficiently discover patterns, reveal anomalies, make predictions and decisions, and generate insights — and are increasingly becoming key drivers of organizational performance,” the company says in a recent report detailing top technology trends in 2021. “Enterprises are realizing the need to shift from personal heroics to engineered performance to efficiently move machine-learning models from development through to production and management.” 

In the sphere of equipment financing and leasing, advanced financing platforms provide nearly instant credit decisioning and automation for manual processes, which streamlines your operations, improves your customers’ experience, and contributes to the scalability and growth of your business. Other must-have qualities in financing technology for capital-equipment suppliers include a solution that covers all functions from approval through the contract’s discharge and retirement, and meets specific requirements of your industry.  

In sum, robust financing software also confers benefits that allow your equipment-financing aim to: 

• Streamline and automate legacy processes 
• Increase sales and repeat business 
• Create credit products promotions and risk-based pricing for your loans or leases in seconds Eliminate human error and operational inefficiencies 

• Deploy bank-grade credit scoring that meets your specifications and terms 

Financing software that provides an intuitive user interface along with a proprietary AI-based decision engine gives you the lowest possible credit risks with the widest potential growth spread.  

Smart financing technology adds up to measurable improvement 

For example, TurnKey Lender says that on average its platform unlocks benefits such as:   

• 58% increase to the average order value 
• 44% increase in sales conversion 
• 20% increase in purchase frequency in 30 days 

“Additionally, equipment suppliers that use TurnKey Lender get to keep the 2% to 6% transaction fees that would go to a bank or other third party,” says TurnKey CEO Voronenko. “Our cloud-based platform is configurable to the manufacturer’s order-processing, providing automation, flexible business logic, loan management, reporting, and customer portals in an integrated solution that makes your financing operations speedy and easy to use.” 

Along with bank-grade decisioning, Voronenko says TurnKey Lender provides equipment suppliers with decision automation specifically for equipment financing and industrial-machine financing, medical hardware financing, and manufacturing-loan options. 

Financing software improves customer satisfaction by making loan approvals fast, accurate, and as flexible as you like, once again thanks to the company’s market-leading AI.  

Another advantage of embedded financing technology for capital-equipment makers is in keeping up to date with changes in technology. While bank-based financing platforms struggle to stay current with evolving technologies and new business requirements, some in-house options work continuously to assess and adopt the best new features available. Why? Simply because R&D the lifeblood and a competitive imperative for embedded-tech makers. 

Here’s what TurnKey Lender Equipment Financing Platform has to offer.

A simple and rational way to provide capital-equipment financing 

AI-driven communications and follow-up allow equipment suppliers to introduce new programs and special offers for corporate financing backed by a variety of lending models including: 

• Factoring 
• Vendor financing  
• Rent to own 
• Lease to own  
• Supplier financing 
• Inventory financing 

In addition, the best open-architecture equipment-financing software supports custom credit products tailored to the needs of capital-gear makers while enhancing their customers lifetime value in the process. 

For TurnKey Lender’s Voronenko, deploying smart, versatile, and easy-to-use financing options with competitive rates is a rational way to stand out from competitors, stabilize cash flow as a bulwark against seasonality, and boost average order size. 

“The key, always, is to build customer loyalty and invite repeat business by offering smart and versatile equipment financing on a level customers have come to expect from the consumer-oriented financial technology in their daily lives,” says Voronenko. “And the best way to get started is with a demo.”