Many younger consumers have a love-hate relationship with credit.They are comfortable borrowing for specific purposes, such as paying for school, buying a car but are uncomfortable carrying credit card balances, partly because they saw their parents struggle with debt during the financial crisis.
Point-of-sale loans are hardly new — banks have been offering them indirectly at the likes of furniture stores and orthodontists’ offices for decades. The biggest players historically have been Wells Fargo, Citigroup and Synchrony Financial. But this type of lending has become increasingly popular in recent years as technology has improved to the point where merchants and contractors that previously may have only accepted cash, check or credit cards are now offering the option of a loan at the moment of purchase, whether online, in stores, or in person. Think of the owner of a roofing company at the house to give an estimate on a project whipping out an iPad to offer an instant loan to pay for the work.