Versatile Credit Helps Consumers ‘Koalafi’ as Credit Tightens

Versatile Credit is offering consumers more choices amid a tightening credit environment.

To that end, the credit aggregation/customer acquisition tool announced in a Thursday (May 18) press release it is integrating financing provider  Koalafi onto its platform.

“Our integration with Koalafi demonstrates our continued commitment to help merchants offer a diverse range of financing options to their customers,” said Versatile Credit President and Chief Operating Officer Vicki Turjan in the release. “By working with great partners like Koalafi, we are empowering merchants to better serve their customers and help them find options that fit their budget.”

Koalafi offers lease-to-own financing to consumers who do not qualify for prime financing options such as buy now, pay later (BNPL) or store credit cards, a population that Versatile Credit said in the release is 40% of all consumers.

The partnership comes at a time when card debt is at an all-time high, as earnings reports have shown that delinquency rates are rising. Those reports dovetail with PYMNTS’ research showing that credit cards have become a lifeline in managing daily expenses.

Speaking to PYMNTS earlier this week, Turjan said there’s evidence that providing a range of financing and lease-to-own offerings from primary and secondary providers — helped by advanced analytics — at the point of sale can help consumers spend and merchants close sales.

“We had a record fourth quarter, and we had a record first quarter on volume,” Turjan said. “That means that promotional financing and financial product choices are more important than ever.”

People are still shopping, she said, but they’re also finding value in spreading payments out over time and in using lenders’ money instead of their own to get what they need.

Installment plans are gaining favor, but no matter whether BNPL or traditional revolving options hold the most appeal, Turjan said a few things drive retailers to the platform.

“There are two philosophies we find with our retail clients,” Turjan said.

On one hand, there are merchants completely invested in using credit to drive sales, while others want to save the sale.