What is soft search? A guide for retailers

Have you heard the term ‘soft search’ but aren’t sure what it is or how it can help your business? You’re in the right place.

What is a soft search?

A soft search (also known as a soft credit check) is a type of credit enquiry that allows lenders to assess a customer's creditworthiness without leaving a visible mark on their credit file. Unlike a hard search, a soft search cannot be seen by other lenders and has no impact on a customer's credit score.

In a retail finance context, a soft search lets customers check whether they're likely to be approved for financing before they submit a full application - giving them the confidence to proceed to checkout knowing that finance is a viable option.

Our soft search functionality is an optional feature of our application platform, which can be seamlessly integrated into your existing POS and ePOS systems. No extra steps, no additional training, no hassle.

Soft search vs hard search: what's the difference?

Understanding the distinction between soft and hard searches is important for both retailers and their customers:

• Soft search: A light-touch credit check carried out before a formal application. It gives an indication of eligibility and is not visible to other lenders, leaving no footprint on the customer's credit file.
• Hard search: A full credit check carried out as part of a formal credit application. This is recorded on the customer's credit file and is visible to other lenders. Multiple hard searches in a short period can negatively affect a credit score.

By offering soft search at the point of sale, retailers can significantly reduce the risk of customers abandoning their purchase out of concern about their credit score.

Soft search + tailored finance = more sales

Soft search becomes even more powerful when combined with tailored finance options. Customers can explore and build an affordable, personalised payment plan with no impact on their credit file - which helps to:

• Increase acceptance rates
• Improve the overall customer experience
• Drive more completed sales for our retail partners

Novuna's soft search functionality is an optional feature built into our application platform, designed to integrate seamlessly with your existing POS and ePOS systems - no additional training or complicated setup required.

Guaranteed soft search

Our guaranteed soft search functionality provides customers with a near-certain indication of whether they'll be accepted for finance, without triggering a hard search on their credit file. This greater certainty meaningfully increases the likelihood of customers completing their purchase.

Novuna can offer up to 99.9% accuracy on all guaranteed soft search decisions, combining state-of-the-art credit technology with real-time decisioning to deliver reliable predictions on final lending outcomes.

Indicative soft search

Indicative soft search uses a shorter question set to provide a probability of approval, giving customers a useful indication of their eligibility before they commit to a full application.

While indicative soft search is less precise than our guaranteed soft search, it remains a highly effective tool for building customer confidence at the checkout - offering a quick and frictionless way to check likely approval before any formal credit check takes place.

Which should I offer to my customers?

Both guaranteed and indicative soft search improve customer confidence and drive higher completion rates. However, our retail partners are consistently most impressed by guaranteed soft search - and it's easy to see why.

The near-certainty it provides removes one of the biggest barriers to checkout conversion: the fear of rejection. If you'd like to discuss enabling guaranteed soft search for your business, our team is on hand to help.

The benefits of offering soft search

• Boost customer experience

A soft search lets customers check their eligibility for financing before any real time is invested, on their part and yours.

• Understand customer budgets early in the journey

Shoppers can explore credit options at any stage of their journey without worrying about damaging their credit score, helping them shop with a clearer budget in mind.

• Increase average transaction value

Knowing how much they can borrow may expand a customer's budget beyond what they can afford to spend outright, making upselling and cross-selling considerably easier.

• Reduce abandoned baskets

A hard credit check can feel daunting and may cause customers to abandon their purchase at the final hurdle. Soft search removes that fear and keeps customers moving towards completion.

• Improve finance adoption

Even customers not initially considering finance may explore their options when they know a soft search won’t impact their credit file, boosting finance adoption.

• Stand out from your competitors

Offering guaranteed soft search can give you a distinct advantage over competitors who offer only indicative soft searches or require a hard search upfront.

Want to find out more about how we can help you drive more business and make more revenue? Contact us today.