Trend for expensive bikes has fuelled consumer lending
Posted on in Cycles News
An economic recovery and the rising trend for high-end bicycles is thought to be fuelling the number of people willing to borrow money to cover the cost of designer bikes.
According to Lloyds Bank, Britain's borrowers are very confident in their ability to repay their loans (83% feel confident they can pay off the debts), which is leading to more people seeking alternative finance options for their desired purchases.
"It's encouraging that, as confidence in consumer finances continue to grow, the majority of people feel in control of their current and future loan repayments. This is enabling customers to enjoy those special occasions and providing the opportunity to restructure their future borrowing in a more cost-effective way," said Lloyds' Sam Clark.
The Lloyds survey of more than 3,000 people found one in five have a personal loan. Of these, 27% borrowed to consolidate their debts in one place, while 26% told the bank they wanted to buy a bike or a car.
Sam Clark, from Lloyds Bank, suggested such high numbers could be partly down to the rising trend for expensive bicycles, "The number of commuters travelling by bike is fast increasing. With different options and flexibility available for consumers to finance a bike, [loans] could continue to be more attractive to commuters in the future.'
Britons in the North, the Midlands and Yorkshire - where the Tour de France started last year - were most likely to take out a loan for a car or bike.
With more consumers looking to finance their bike purchase, there has never been a better time to start offering in-store retail finance.
With Ride it away retail finance, a customer can walk into the bike shop of their choice, select the bike, accessories and clothing of their choice and walk out of the shop the same day having left as little as 10% deposit and spreading the remaining cost over a period of 6 to 48 months.
Plus, the retailer benefits from retaining that customer and making the sale the same day - no waiting for a bank loan or risking the customer going elsewhere once they have left the shop.
Start offering retail finance today!
There are currently over 800 retailers offering finance through ActSmart's retail finance scheme, accounting for £60m of new sales every year!
If you aren't currently offering finance, you are missing out on the growing number of consumers wanting to purchase high-end bikes. With over 800 retailers offering the service, your customers could soon find their way to competitors who do offer the finance options they're looking for.
Ride it away is available to any cycle's business who will benefit from:
Free V12 set-up worth £495- Personal support throughout the application and FCA authorisation process
- No minimum finance turnover requirement
- Payment issued by V12 same day and in your bank within 4 days
- National promotion on the Ride it away and Take it outdoors consumer websites
- Access to FCA compliant POS material
- Access to web banners for use on your own website
Click here for more information about the Ride it away scheme
Get started for free
The FCA announced on 18th March that retailers offering limited retail finance options are no longer required to be authorised by the FCA. Retailers who offer 0% (interest free) finance up to 12 months will no longer have to be authorized and regulated by the FCA, or be liable for the annual fees and charges involved with being regulated.
However, whilst retailers no longer need FCA authorisation to offer the basic 0% option, ActSmart and V12 have created a wide range of product options which enable retailers to offer their customers different APRs and protect their margin. In order to fully utilise all the product options available you will still require FCA authorisation, which costs just £100.
With more customers feeling confident in their ability to pay back their loans, the interest bearing options are just as popular with consumers as the 0% options.
What next?
Click here to find out more and request your free application pack or contact us on 0845 618 7256.