Sunbit recently secured $355 million in debt financing from JPMorgan Chase, Mizuho, and Waterfall Asset Management to enhance its consumer loan offerings across a broad network of 47 U.S. states. This capital injection aims to fuel growth primarily in essential in-person transactions such as auto repairs, dental procedures, and eyewear purchases, offering an alternative to online buy-now-pay-later (BNPL) services.
Focus on Non-Discretionary, Repeat Physical Purchases
Sunbit targets sectors that reflect urgent, repeat spending needs rather than discretionary online shopping. This strategy helps the company avoid highly saturated digital BNPL markets, creating deep customer loyalty in critical service segments. By focusing on brick-and-mortar retailers, Sunbit builds stronger in-person payment solutions that align with how consumers engage with essential services like car maintenance, dentistry, and eyewear needs.
Merchant Fees and Revenue Model
Charging merchants fees in the range of 8-9%, Sunbit's pricing is somewhat higher than other BNPL competitors. This merchant fee structure accounts for approximately 45% of the company's total revenue, enabling the business to reinvest in innovative partnerships. For instance, the collaboration with Ollie’s introduces co-branded credit cards designed to enhance customer acquisition and bolster loyalty. This approach demonstrates how Sunbit leverages merchant partnerships to expand market reach and improve retention metrics.
Loan Volume and Approval Metrics
Sunbit's loan issuance rate exceeds 100,000 loans per month, with the average loan size close to $1,000. The company maintains an approval rate around 90%, making financing accessible to a broad base of consumers. Interest rates currently average 20% and are capped at 36%, establishing clear rate boundaries while remaining competitive. Notably, Sunbit has removed late fees and origination charges, attracting lower-middle income consumers who typically hold average credit scores around 700, making it easier for them to access financing with transparent terms.
Software Integration for Seamless Retail Financing
With financing software embedded in over 9,000 car dealerships and 12,000 dental offices, Sunbit enhances the loan application and approval process for merchants and consumers alike. This embedded technology streamlines financing operations within physical retail environments, allowing customers to access credit with minimal friction. The software’s ease of use supports merchants’ ability to offer consumer financing even in time-sensitive settings, such as auto repairs or medical appointments, where funding speed and reliability are critical.
Disciplined Underwriting and Risk Management
Sunbit applies rigorous underwriting standards that help keep delinquency rates under 5%. This disciplined risk management is essential given the target market’s average credit profile and the absence of late fees or origination charges. Maintaining low default rates while operating in repeat, essential spending categories reflects an efficient credit risk strategy that benefits both consumers and merchants, ensuring sustainability of the loan programs.
Positioning Beyond Online BNPL Offerings
The company’s deliberate focus on in-person, non-discretionary purchases distinguishes it from the crowded online BNPL space. By catering to urgent, real-world retail spending pockets, Sunbit fills a niche requiring immediate, flexible financing that digital-only competitors struggle to serve effectively. This strategic positioning supports growth in multiple physical sectors where customers often need funding but lack easy access through traditional credit or digital BNPL platforms.
Sunbit’s initiative to expand consumer loan offerings across dozens of states, backed by significant debt financing and advanced software integration, provides merchants in auto services, dental care, and eyewear with powerful tools to increase customer retention and sales. By balancing competitive interest rates, transparent terms, and technology-driven financing solutions, Sunbit meets the needs of consumers with average credit standing often overlooked by traditional credit products. These developments underscore a growing trend in consumer finance toward tailored, in-person lending that strengthens essential service sectors.