ARC90 is essentially a credit bureau for short term
lending. It's designed to facilitate consumer purchases up to a year
in length. It accomplishes this by examining recent account activity
associated with income and day to day living. We use over 30
parameters ranging from overall economic conditions to the
customer's own level of responsibility to create a best fit for a
customer without looking at the major credit agencies. We don't
collect a social security number and we don't do a hard or soft
This isn't a no credit check program, rent to own, or one of the many variations meant to gouge a consumer who may have less than an ideal big 3 credit rating. It's not for people who don't pay their bills either. The 3 major bureaus have 7 or more years worth of history which is fine for loans extending over long durations. In our opinion ARC90 is an accurate alternative for shorter periods.
ARC90 looks at the last few months of bank/employment activity and makes a fair assessment of the individual's financial position. Technically we don't charge the customer interest. There is a one time per sale ARC fee of $35.00 assessed. The merchant pays a discount rate to guarantee the payments. This discount is usually added to the sale amount. This is done automatically during the sale process with 'add plan fee' set to YES while creating the sale. The store is charging the customer interest when it's added in. However, most consumers are thrilled to have the fixed low rate we provide the store. It beats most credit cards and it's a lot better than any rent to own program we're aware of.
The rate we charge the store is based on the duration of the payment plan. Three and six months is 9%. Nine months is 12% and 15% is for a year. These rates are not for 'best case' customers. Everyone that's approved gets these rates. In addition, if the customer pays off their balance within the first 90 days we waive the discount entirely. If it's over 90 days all future interest is waived. No other fees are added in to get this benefit.
If pie charts don't explain it well enough maybe this
will. A dollar for dollar side by side comparison between ARC90 at 15% and a typical 80% rent to own lease
for a year.
The purchase amount a customer's monthly income will qualify for.
It's what the merchant can sell.
The lease data was pulled from a publically
The ARC90 data was created by using a customer and adjusting the income
to match what's called out in the chart. TX was used since it's a middle of
the road income state. The lease chart stated these weren't guaranteed amounts.
In both cases it's a year long term with an ideal customer.
The cost to a
customer over a year term for the same 80% lease versus ARC90.
This assumes the known at the time $40.00 lease fee and $35.00
arc fee and no other fees beyond the rate charged.
Looking at the
two charts it's clear the customer and merchant are each getting
progressively taken advantage of in a lease. ARC90 is a better option for both.