METRIC MIKEY’S FRIDAY FINTECH FUN

So, something a little different. I was thinking about the very, very bottom of the purchase funnel this morning, the payment options. Until a few years ago (working for a finch company), I had never considered that one leading factor to an abandoned purchase was a credit decline. It should have been obvious that sometimes credit cards are declined. But it becomes an even greater risk when alternative financing options are involved.

Then, coincidentally, I read a newsletter I get from ‘The Hustle‘ about Affirm’s possible $9B IPO as a result of the booming $24B “buy now, pay later” (BNPL) industry.

no, cancellation, rejection

This reminded me of an issue some financing companies have with approving younger customers who don’t have much, if any, credit. Because of that, they have what is called a ‘thin file’ and cannot be approved. The great credit conundrum. They can’t get credit because they don’t have credit history. But they can’t get the credit history, because they cannot get credit. But that is another topic for another day.

Bringing it back to the abandoned purchase at the very, very bottom of the funnel. Here is a little food for thought:
Almost 20% of shoppers between 22-30 yrs old have insufficient credit history for credit card approval.

It may be worth it to do a bit of a deeper dive into the segment of customers who opt fo try the financing option. Abandons may have nothing to do with you.

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