Majority of SMBs to Offer Flexible Payments and Discounts as Student Loans Resume

According to Capterra research, 76% of finance managers believe that the return of loan repayments will push the economy towards a recession.

ARLINGTON, Va.--(BUSINESS WIRE)--As millions of student loan borrowers resume payments, businesses are making strategic changes in anticipation of a shake-up in consumer confidence. According to Capterra’s latest survey, a significant 83% of finance managers at B2C small and midsize businesses (SMBs) are adjusting sales strategies to better support affected consumers.

The return of student loan repayments, coupled with persistent inflation and high interest rates, presents a daunting scenario for 2024. An overwhelming 76% of surveyed finance managers believe that the resumption of repayments will push the economy towards a recession in the upcoming year. The survey further highlights that 60% of businesses are operating under the assumption that student loans will not be partially or fully forgiven in the future.

Despite these challenges, many businesses remain optimistic about their revenue prospects. A surprising 46% anticipate an increase in their revenue in 2024, attributing this outlook largely to planned pricing increases. In stark contrast, only 5% of businesses are considering dropping their prices in response to the loan repayments.

However, there are some red flags to account for. Rapid price increases in an already stressed economic environment could backfire. It’s crucial for businesses to weigh the short-term gains of price hikes against potential long-term consumer attrition.

It's still to be seen the extent to which student loan repayments will impact customer churn. As such, finance managers are re-strategizing to engage consumers affected by the repayments, with methods such as "buy now, pay later" (37%), targeted discounts (34%), and flexible returns policies (33%).

“With high interest rates, inflation, and other economic headwinds, affected consumers will now have to allocate a portion of their already squeezed budget toward student loan repayments,” says Max Lillard, senior finance analyst at Capterra. “While it’s unclear how payment resumptions will impact the economy in the future, many businesses plan to make internal and external operational changes to cater to consumers burdened by debt.”

As the economy remains unpredictable, businesses are advised to lean into robust forecasting. Implementing rolling forecasts, using financial management software, and focusing on pertinent metrics can equip businesses with the agility and resilience required to navigate the upcoming challenges.

Read the full report to gain insights on how businesses can mitigate the financial challenges posed by the end of student loan forgiveness. For more recommendations on software and services to support robust forecasting, visit Capterra.com.

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