Finance is not new in the car market – 92% of all new vehicles in the UK are supported with some form of credit. But one thing that surprised me as I walked around Fully Charged Live South was just how limited the finance options seem to be for Electric Vehicle (EV) home chargers.
Much like when you buy a shiny new iPhone, the charger doesn’t come with it. And many new EV owners will be disappointed to discover that they need to purchase this essential but costly additional piece of kit. Particularly if they’ve just stretched themselves to afford the monthly vehicle repayments.
Finance options for home chargers are sadly lacking. Despite costing anywhere between £700 and £1,500, customers are often presented with Buy Now Pay Later (BNPL), which gives the option to spread the cost over three payments. But that’s still £500 a pop, considerably more than the £148 the average Brit has left after bills each month, and particularly painful having just paid for an expensive car.
Some EV merchants offer interest-bearing retail finance options instead. These allow the consumer to spread payments over a longer period – between two and three years – with more frequent, smaller payments and an APR of around 7.9%. Consumers can reduce their monthly payments to an affordable amount. But this type of finance penalises the customer with interest.
The EV market needs longer term finance for EV home chargers, with interest-free and low interest options. So consumers are supported during the cost of living crisis and can afford to buy at short-notice.
Fortunately, there is a solution
Divido’s white labelled retail finance platform allows EV merchants to offer a range of flexible financial options to their customers.
Interest-free credit allows new EV owners to spread the cost of an EV home charger over three years at no cost to the consumer. And low-interest bearing allows them to spread the fee over longer periods, up to ten years.
In any case, customers can install their EV home charger unit immediately to reduce the cost of charging overall. No need to save up to install, and no need to pay interest. Customers can also ‘lock in’ the price of their EV home charger units, protecting themselves not only from expensive public charging units, but from future product price rises.
As a merchant, you connect to reputable Tier One lenders with experience lending to the EV market to get paid immediately. Our white label feature allows you to offer finance under your own brand, providing full control over your customer experience, journey and data.
“Checkout finance has been shown to improve retail revenue in a number of ways,” says Divido CEO, Todd Latham, “which is important for merchants during a recession, when they may be starting to see sales drop.
“Finance has been shown to increase average transaction value, lower rates of basket abandonment and improve numbers of repeat purchases.
“When consumers feel more confident in their payment options, they spend more, and this benefits the merchants as well as giving customers access to essential purchases like heating appliances.”
But don’t take our word for it…
We’ve processed over £2 billion in credit applications since 2014. Our merchants see an average uplift of 20% sales revenue, some of whom now derive 40% of their business from our world-leading checkout finance.
If you’d like to learn more about checkout finance for the EV market, I’ll be at Fully Charged Live at the Yorkshire Event Centre, Harrogate, on Friday 19th May 2023. Reach out to me via LinkedIn to book a meeting.
Want to learn more about the benefits of Buy Now, Pay Later?
Divido’s latest white paper offers never-before-seen insights into the world of checkout finance. Understand how and why customers are flocking to this form of payment, with real statistics backed up by our survey of British consumers. Download your free copy here: