The Green Sheet Online Edition
October 10, 2016 • 16:10:01
Interest-free online, in-store installment plans
Splitit USA Inc., headquartered in New York City, created Splitit, a payment technology service that facilitates interest-free installment plans. The solution enables merchants to offer additional options at checkout to customers using Visa Inc.- and Mastercard-branded credit cards. Consumers can divide the total cost of a product or service into as many payments as they choose, using their existing credit cards, without applying for a new line of credit. The service, subsidized by merchants, is designed to improve shopping cart conversions and in-store sales of large ticket items.
"Ecommerce merchants typically resort to free shipping and aggressive discounts; there has not been much innovation in the space," said Michael Avni, Chief Marketing Officer at Splitit. "We asked about 8,000 U.S. credit cardholders about their payment preferences; 54 percent stated they prefer installment plans over free shipping, and 63 percent of high-income credit card users prefer installments over a 10 percent discount."
Commerce enablement
The Splitit service works as an intermediate layer between the POS and payment gateway, directing installment transactions to Splitit and then relaying the transaction to the gateway. Splitit works with payment gateways to reconcile installment plans, confirming authorizations on outstanding balances and investigating discrepancies. The service highlights all unreconciled items to ensure that merchants have valid authorizations for outstanding balances at all times, the company noted.
Splitit authorizes each purchase by reserving an available line of credit, collecting installment payments each month and reissuing the authorization request for the remaining balance before the current authorization expires. Merchants get paid in monthly installments, minus processing fee deductions. Consumers and merchants can use secure portals to view and manage installment payment activity.
The company also provides Splitit Healthcare, an interest-free financing solution offered on patients' existing credit cards to cover cosmetic, weight loss and elective surgeries, as well as the dentistry, hearing, vision and veterinary healthcare verticals.
Multiple integration options
Splitit is acquirer-agnostic and supported on most U.S. payment gateways, the company stated. Merchants and service providers can choose from multiple integration options. Following are some examples Splitit noted:
- Web API: This online tool enables ecommerce and brick-and-mortar merchants to send installment transactions to Splitit. It requires Payment Card Industry Data Security Standard (PCI DSS) compliance to protect in-scope payment card information. Embedded code: A PCI-compliant Pay Button can be integrated into ecommerce checkout to optimize customers' web and mobile checkout experiences, while ensuring that payment card information remains out of scope.
- Virtual POS: This virtual method eliminates the need for integration. Brick-and-mortar merchants and service centers can use the merchant console to input customer details and create personalized installment plans.
- Magento extension: A free Magento extension enables merchants to immediately add interest-free monthly payments into the checkout process.
- WooCommerce plugin: The WooCommerce plugin lets customers pay for goods and services via interest-free monthly installments using existing Visa and Mastercard credit cards.
Sustainable payment strategy
Splitit emphasized the following: it enables merchants to offer instantaneous personalized installment plans to customers without changing their existing risk tolerances or procedures; the patented solution facilitates installment payment plans while eliminating the need for additional credit screening, credit applications and registration forms; and it enables customers to make major purchases without compromising on quality or paying any interest or convenience fees.
Merchants and customers who participated in a May 2016 Splitit survey indicated that the service makes high ticket items affordable at zero interest, helping consumers budget and build credit. Merchants also reported the service has helped improve conversion rates, average ticket prices and customer satisfaction levels. Some retailers promote the monthly payment option in advertising campaigns, using low per-month pricing to attract customers, the company stated. 
Website:www.splitit.com Contact: sales@splitit.com
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