Should Your Business Offer White-Label Financing?


Are you looking to increase repeat business, customer loyalty, and brand recognition? White-Label financing, credit cards, and payment portals can do all of this for you and more.

This article will define the different types of white-label financial products available, describe the potential benefits of each, and give you a checklist to determine whether one or more white-label financial products would benefit your business, from the office of a noted criminal appeals lawyer in Pittsburgh.

What Does “White-Label” Mean?

“White-Label” is the term that refers to something that is branded with your business name and logo. It will look as if it comes from you, but it was manufactured or is backed by another company. “White-label” is also called “private label” in some fields.

Everyone has seen and used promotional products carrying business logos, but white-labeling is not limited to physical products alone. Services and financing can also be white-labeled. When you partner with another company offering a white-label service, your business accesses a service that you need, in your name, that would not be possible for you to do in-house because of lack of resources of personnel.

White-label services and products that are commonly found today include:

  • Website hosting
  • Website design
  • SEO
  • Online reputation management
  • Digital marketing
  • Online content creation
  • Accounting
  • Payroll

What is White-Label Financing?

White-label financing was the original of the three white-label financial products described in this article and set the stage for the creation of and demand for the other two, which are white-label credit cards and white-label payment processing portals.

Anyone who has shopped for a car at a dealership has been offered or has taken advantage of the auto-branded financing. This is the most common example of white label financing. While financing is backed by a lending institution, it appears to come from the automobile manufacturer. All contracts and bills are branded with the manufacturer’s name and logo.

How it works is this: a dealership will have someone on staff who is trained in operating the software and navigating the online portal through which they can access a customer’s credit history and the terms and interest rates currently available. They can then make a loan offer while the customer is there and close the loan immediately.

Not only does offering in-house financing streamline the purchasing process for the customer, but the ability to offer a loan on the spot tends to convert more shoppers to purchasers.

In recent years other retailers, such as those offering luxury goods like jewelry, fur coats, and wedding dresses, have begun to offer their own branded financing to put these goods within reach of more customers and take advantage of the higher conversion rate. Travel and cruise ship companies have done the same.

What is a White-Label Credit Card?

A white-label credit card looks and operates like any credit card but is branded with your company name and logo. The difference between a credit card from a major lending institution and your credit card is that you can create a loyalty reward program through which you offer exclusive discounts or cash-back and incentivize repeat business.

If a customer maintains a revolving balance on your white-label credit card, it will be subject to interest, and you may benefit financially from that depending upon your contract with your partner lending institution. A customer carrying your white-label credit card can use it anywhere, and you may benefit financially from that as well.

Offering a credit card with your business name and logo also boosts your reputation and credibility. For example, let’s say you are an interior designer and there are two furniture stores in your area. They offer competitive pricing and are the same distance away, so there is nothing to differentiate one from the other. However, one of the two offers a white-label credit card and a generous customer loyalty program with periodic discounts and sales. Which store would you patronize? Not only does it make business sense to shop at the store offering a credit card, but the credit card itself gives the impression that the company is profitable and stable.

In sum, a white-label credit card encourages repeat business, creates and grows customer loyalty, boosts brand recognition and credibility, and may earn money on interest on your customers’ revolving debt.

What is a White-Label Payment Processing Portal?

A white-label payment processing portal is a branded payment site that is linked to your company’s shopping cart. Not only can customers pay you through this site, but they have the option of creating a password-protected account with you that saves their contact, shipping, and payment information. This way, the processing of future orders is streamlined for your repeat customers, and you can email account holders about exclusive sales and discounts. Both the ease of ordering and access to exclusive sales promote repeat business.

How to Know Whether a White-Label Financial Product is Right for Your Business

Answer the following questions to find out whether your business would benefit from enrolling in a white-label financial program:

  • Would the availability of immediate in-house financing incentivize shoppers to purchase from me?
  • Would the availability of in-house financing attract new customers?
  • Would my current customers be interested in a white-label credit card?
  • Is a customer loyalty rewards program appropriate for my business?
  • Are discounts for white-label card users or portal account holders useful for my business?
  • Will a white-label credit card or financing help me differentiate from my competition?
  • Does my business have the resources, such as time and personnel, to administer white-label financing, credit card, or online payment portal program?

If you decide to partner with a financing company, compare and contrast the different white-label financial programs on offer and find out:

  • What you would have to change in order to work with this company:
  • How much their white-label financial product costs upfront:
  • How much their white-label financial product costs monthly, or quarterly, or yearly;
  • What resources are required to administer their financial product;
  • Whether the financing company offers training in the virtual interface or software;
  • Whether the financing company offers ongoing support;
  • Whether ongoing support requires an additional fee.

Is There a Downside to White-Label Financial Products?

Possibly, if you do not do your homework. When you research and compare the white-label financial products offered by different financial institutions, consider the following three things:

Partner with a Financial Institution That Offers Mobile Payment Options

As part of your research, be sure to determine whether the white-label financial programs you are considering accept mobile payments such as Google Pay, Apple Pay, and Samsung Pay. Reliance on paperless payment is growing more common, especially among millennials.

Do not sign up for a program that does not incorporate and commit to incorporating the latest technology, because if the program becomes outdated and difficult for customers to use, they won’t.

Compare the Cost and the Benefits of Different White-Label Financing Agreements

Every financial institution that offers white-label financial products will have programs that differ in both costs and benefits to your company. Small business owners must be especially cautious and avoid signing up for a program that requires personnel, training, time, or other resources they do not have.

Ask for References from the Financial Institution’s Current Customers

When you’ve narrowed down your options, take the time to talk with business owners who have partnered with the financial institution under consideration before signing anything. Discuss their experience working with them, and be sure to ask if they have any regrets or wish that some aspect of the program they purchased was different.

Perform your due diligence prior to purchasing a white-label financial product. You will avoid being overwhelmed with a program you don’t have the resources to administer or that is more expensive than you anticipated, and you will reap the benefits your business needs.


About the Author

Veronica Baxter is a legal assistant and blogger living and working in the great city of Philadelphia. She frequently works with Todd Mosser, Esq., a Philadelphia appeals attorney.




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