A POS financing platform lets a merchant offer credit at checkout, in store, online, by phone or in the customer’s home, and connects that offer to one or more lenders. The platform runs the application, the decision flow and the merchant integration; a bank or licensed lender makes the loan. Multi-lender platforms send one application through several lenders, so a shopper declined by one can be approved by the next.
Three ways POS financing is set up
| Model | How it works | Example from provider documentation |
|---|---|---|
| Single lender | The merchant offers one lender’s financing, such as a private label card or an installment plan | — |
| Multi-lender “waterfall” | One application is matched in real time across several lenders, from prime to no-credit-required programs | ChargeAfter describes a matching engine across its lender network |
| White-label hub for banks | A bank licenses the platform to build and distribute its own POS lending to merchants | ChargeAfter’s Lending Hub |
ChargeAfter says its lender network covers prime, near-prime, subprime and no-credit-required programs, with products including revolving credit, private label credit cards, lease-to-own, installment loans, buy now, pay later (BNPL) and B2B financing. Lenders it names include Wells Fargo, Citi and Synchrony.
How a platform connects to the merchant
ChargeAfter’s documentation lists four sales channels (e-commerce, in-store, call center and in-home) and three integration methods: e-commerce plugins, a client-side JavaScript SDK and a REST API, which can be combined. When comparing platforms, check which channels are supported out of the box, how the decision reaches the point of sale and how refunds, cancellations and partial returns flow back to the lender.
Who is the lender of record
The platform is usually not the lender. In embedded lending for businesses, Parafin states that all its loans are issued by Celtic Bank and its Spend Cards by Column N.A., Member FDIC, while Parafin handles underwriting, servicing and support. In a POS waterfall, each loan is made by the lender that approves it. The lender of record decides whose disclosures the shopper receives and whose rules apply; if it is a bank, the platform is that bank’s third party. See how to choose a sponsor bank.
Rules that shape the checkout
- Deferred-interest ads. For open-end credit, if an ad promotes “no interest” on a deferred-interest offer, Regulation Z requires the words “if paid in full” and the deferred-interest period next to the claim, plus a statement that interest will be charged from the purchase date if the balance is not paid in full in time (12 CFR 1026.16(h)).
- Declined applications. Regulation B requires a creditor to notify an applicant of adverse action within 30 days after receiving a completed application (12 CFR 1002.9). The notice duty applies to credit declined at the point of sale as well; in a waterfall, plan who sends which notice.
- BNPL. On May 12, 2025 the CFPB withdrew its 2024 interpretive rule that had treated certain BNPL digital user accounts as credit cards under Regulation Z. The CFPB’s BNPL compliance page records the withdrawal.
What to ask a POS financing platform
- Which lenders are in the network, and which credit tiers and products do they cover?
- Who is the lender of record for each product, and whose disclosures does the shopper see?
- Which channels and integration methods are supported?
- How are adverse action notices handled when several lenders decline?
- How is the merchant charged, and is pricing published? ChargeAfter does not publish pricing.
