Getting a small business financing operation up and running isn’t something you do overnight. You need to have infrastructure, license and funding amongst a number of things in place to be able to do it. But thanks to embedded finance, non-financial companies can leverage the capabilities of financial companies and integrate financing solutions and offer it directly to their customers. Offering financing to your customers brings a number of benefits to your business, here are five reasons why you should add it to your offering.

‍

Your customers need it
‍It’s no secret that access to financing is a major hurdle for the majority of small businesses, and has been for quite some time. Europe alone has a 400 billion EUR financing gap, and worldwide the number is in trillions. So, your small business customers probably have a hard time getting access to financing when they need it, and you can solve it for them. But it’s not only that you’ll give your customers that are actively seeking financing a solution to their problem, you’ll also open up possibilities for those who aren’t in the market at the moment. Knowing that they have access to financing if and when they need it, your customers can make bets and investments they previously held back because they didn’t think they could finance them. It will also allow them to become more flexible with their cashflow management.

‍

An additional revenue stream
‍The most obvious reason to integrate financing is the fact that it allows you to add an additional revenue stream, which requires minimal effort or investment from your end. With Embedded, you can integrate our white-label SME lending solutions into your existing platform with only a couple of hours worth of development time. Once integrated, the only thing you need to do to earn money from it, is to funnel your customers to use the service. You don’t need to worry about the operational aspects, funding or credit risk as the platform handles all of it. Essentially, embedded SME financing lets you add a service to your offering that manages itself and generates income with no risk attached to it.

‍

It increases loyalty
‍It’s not only revenue that you get from embedding financing though. Another reason why you should add financing is because your customers will start to see you as an enabler of their success, as you’d solve a problem that many of them have. That might lead to even bigger gains than the revenue you’re earning from their lending. When your customers become more satisfied, they will also become more loyal to you, meaning your NPS score will increase. You’ll essentially start a circle of growth, where your customers will do more business with you, while also turning into promoters for your brand.

‍

Makes customers stay customers for longer
‍It’s not only the customers that become promoters that will stay for longer though. Your average customer will too. Partially because you’ll get a lock-in effect on customers that have an active loan, as it will become harder for them to switch during the repayment period. But more importantly, because offering financing makes your overall offering more attractive. You’ll gain an edge on your competitors by offering a service that brings value to your customers. And the knowledge that financing is far from widely available for small businesses elsewhere will also have an effect. It will make your customer more hesitant to move on from your business, as doing so means that they’ll also move on from the possibility of accessing financing when they need it, and will lower your churn rate as a result.  

‍

Potential to grow your core business
‍Interest revenue, increased loyalty and reduced churn can all be attributed to the lending itself – but looking past, adding financing to your offering will have more long term effects. Financing will enable your customers to invest and grow their businesses, and when they do, they will grow their overall business with you too. So on top of the short term effects of embedded lending, you’ll also get long-term core-business growth from providing your customers with the tools to help them succeed.

‍

Small businesses need financing, and by integrating lending into your offering, you can bring it to them, and gain positive effects to your business in the process. By using Embedded, you can add a lending solution that is developed specifically to the needs of SMEs and that’s easily integrated into your existing platform, under your brand, With an application process that is completed in minutes, automatic data collection, credit analysis and decisioning, as well as instant loan disbursements, you can give your customers an unmatched financing experience, while proving value for both you and your customers.

‍

Book a demo today to learn more about how embedded lending can help you grow your business.