Gun Sellers Push Quick Buy Now, Pay Later Financing

(Bloomberg Businessweek) -- If you visit the website for gun manufacturer Daniel Defense, the first thing you’ll see is a pop-up message offering condolences to the victims of a gunman who killed 21 people at a school in Uvalde, Texas. Of those killed, 19 were children. “We are deeply saddened by the tragic events in Texas this week,” it reads. “It is our understanding that the firearm used in the attack was manufactured by Daniel Defense. We will cooperate with all federal, state and local law enforcement authorities in their investigations. We will keep the families of the victims and the entire Uvalde community in our thoughts and prayers.”.If you scroll down and click on a panel promoting a financing option from the company, you’ll get a different message: “Enter to win $15K when you buy now, pay later with Credova,” with an explanation of how to enroll in the sweepstakes in three easy steps. .The partnership with Credova, a Bozeman, Mon.-based consumer finance company that offers installment plans on firearms and goods tied to outdoor activities, is illustrative of how far-reaching so-called “buy now, pay later” programs have become in retail sales. Credova says it did not finance the purchase by the killer in Uvalde. Daniel declined to comment..The offer is also a reminder of how accessible firearms are in the vast majority of the US. Two deadly mass shootings in May, and the impending Supreme Court ruling that could greatly expand the presence of handguns in the country’s most populous cities, have reignited the nation’s gun control debate. At the same time the market for guns operates much like any other consumer business, including access to quick financing. “When we see gun retailers and gun manufacturers employ those same types of promotional strategies, it really normalizes and legitimatizes guns as just another kind of consumer product that people should be able to access with minimal interference,” says Aimee Huff, an associate professor of marketing at Oregon State University. “It does pragmatically and symbolically make firearms more accessible.”.A spokesperson for Credova says buy now, pay later financing represents a small fraction of firearms purchases, and that most firearms are purchased with credit or debit cards. (Everytown for Gun Safety, which advocates for universal background checks and gun-safety measures, is backed by Michael Bloomberg, founder and majority owner of Bloomberg News parent company Bloomberg LP.).Buy now, pay later companies work with retailers to offer customers at the check-out counter or online the chance to pay in installments instead of laying out the full amount up front. They’ve boomed in recent years as merchants have found they improve sales, while younger consumers see them as an easier alternative to credit cards. Many buy now, pay later programs split payments into four interest-free installments. Based on information on Daniel’s website, Credova offers a different kind of financing that may charge interest if the balance is not paid in three months. A Credova spokesperson says the company is evaluating a pay-in-four offering, which its website says is “coming soon.” Credova says that like other industry participants, it earns money through fees paid by merchants, and not fees charged to customers..Some of the biggest names in buy now, pay later financing steer clear of guns. Affirm Holdings Inc., Block Inc.’s Afterpay, and Swedish lender Klarna don’t work with firearms sellers in the US. Affirm and Afterpay both state that it’s against their merchant policies, along with items including fireworks, drug paraphernalia, e-cigarettes, and tobacco..But Credova does not appear to be alone. According to its website, Minneapolis-based Sezzle Inc. works with a number of sellers of guns, ammunition, and accessories such as concealed carry holsters. Sezzle did not respond to a request for comment..Credova focuses on outdoor sporting goods, with 37 businesses listed on a page marked “hunting stores” on its website. “Maybe because political beliefs or whatever it may be, a lot of our competition in other industries don’t like to come into this industry,” Credova Chief Revenue Officer Kamron Davis said in an interview shared on YouTube in January. .SafeSide Tactical, a Virginia-based firearms manufacturer and dealer, started the process of working with Credova in the summer of 2019. “That was before buy now, pay later was mainstream, right at the cusp of it,” says Mitchell Tyler, SafeSide's co-owner and vice president. "We have a small group of merchant processors and banks that will do business with us because we are a firearms dealer and manufacturer." Before Credova, the company was only able to offer a layaway plan where customers could pick up their firearm after all the payments were made. Background checks and pick-up of the firearm are completed onsite, says Tyler, even if a customer makes the purchase through Credova online..Credova’s Chief Executive Officer is Dusty Wunderlich, who used to run a now-bankrupt holding company that had businesses leasing consumers everything from dogs to wedding dresses. Credova has also done pet financing, which led to a brush with regulators. The Massachusetts Attorney General’s Office settled in 2021 with Credova and another company over allegations that it leased dogs in the state, which is illegal there. Credova did not admit it violated any law..“We consider ourselves a financial technology company,” Wunderlich said in trade show interview posted on Facebook. “What a lot of financial technology companies are doing is trying to make the customer experience easier.”.More stories like this are available on bloomberg.com.©2022 Bloomberg L.P.

Gun Sellers Push Quick Buy Now, Pay Later Financing

The offer is also a reminder of how accessible firearms are in the vast majority of the U.S.

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