Can Creative Financing Options Save Holidays?

November 24th, 2008

According to a Nov. 20 article in The Wall Street Journal, eBay Inc. is going to leverage the technology they acquired with the six-week-old purchase of Bill Me Later by testing a holiday credit line for consumer users of their PayPal service. Each consumer in the PayPal system will be allotted credit based on an assessment of their finances.

Like with Bill Me Later, people who use the credit will not have interest accrue on their account for a few months. PayPal was to begin the service on Nov. 21, according to the article.

What does this mean for online marketers? Well, if your site offers the PayPal option, this is a small bit of good news in an economically sullen time. Theoretically, this should help your sales — your customers have another guilt-free payment option.

The bigger picture isn’t so pretty. This is probably the latest sign that retailers are really feeling the heat and need every good idea they can get during the holiday stretch ahead. PayPal is simply trying to help out their retail partners, while mounting whatever transaction fees they can along the way.

I also found the PayPal news to be a particularly relevant development because we at Sherpa have recently spotted a couple of eretailers who are doing something that appears smart in this climate: They are offering cash-and-credit-strapped customers the chance to make a single purchase with two separate credit cards.

Well, there’s an idea to swipe and test. It certainly seems like a potential winner.

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