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Interest free credit

Interest free credit: a jewellery retailer’s case study

For modern-day retailers, offering a range of payment options, including interest free credit (IFC) is an absolute must. It’s a significant factor in a consumer’s purchasing decision, and so isn’t something retailers can afford to overlook. And with the current economic crisis, this is only set to become more important to customers as they seek to spread the cost of high-ticket items over several months.

The additional benefit of offering interest free credit is that often it also results in a higher average transaction value as consumers see it as a way to opt for a product they may not be able to afford in one transaction.

Novuna Finance is an approved supplier to the Company of Master Jewellers (CMJ), offering special criteria for members, including:

– No minimum turnover level
– No minimum balance sheet tangible net worth
– No minimum finance volume
– No minimum 2-year accounts (fledgling CMJ members can still apply)

CMJ members taking on Novuna are given access to its Creditmaster3 system, which features a guaranteed 100% accurate soft search, tailored loans (which gives you options for loans that would normally have been declined for affordability), and a fast and easy online process. You can process a customer’s finance application in less than three minutes and Novuna’s system is designed to give you an instant decision (however on the occasions that it is unable to give a decision there and then, Novuna’s dedicated underwriters will be able review the application manually).

One retailer member that has recently introduced Novuna Finance to its business is Sonny’s Jewellers, based in the heart of Birmingham’s Jewellery Quarter. We talk to Sonny J, MD of Sonny’s Jewellers, about how the system was implemented and the difference it has made to his business.

How did you find setting up a facility with Novuna Finance?

The process was very easy to set up. The team at Novuna were fantastic at setting up the portal and training the team in how to use it. They made the process simple and smooth to implement in our stores.

Has offering finance to your consumers increased your sales?

By offering finance to our customers, we are often able to increase the transaction value – the customer who would find stretching to that slightly bigger diamond or a slightly better quality is able to spread the extra cost easily over up to 10 months interest free. It also helps to secure the sale quicker as instead of waiting for the customer to save up for their dream purchase, they can quickly get an interest-free credit option.

Has the finance offering increased the average transaction value?

Yes, the customer often still spends what they have budgeted for and uses the finance option to increase the value of their purchase.

How valuable do you feel offering interest free credit is as a retailer?

I believe in the current economic and retail climate, offering interest free credit is essential when budgets are already tight, and spreading the cost of larger purchases can really help the clients.

How have you found the service so far with Novuna?

The service has been fantastic – the team at Novuna have always been available for any questions and to support the stores in their journey.

For more information on Novuna, visit their website.

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