Many firearms sellers today are partnering with finance companies, to offer buy-now/pay-later deals on firearms to encourage sales.

One such company is Daniel Defense, a high-end manufacturer of AR-15 rifles. The company is most notable for being in the news recently, having made the firearm used by a school shooter in Texas. In a deal becoming common within the industry, Daniel Defense has partnered with consumer finance company Credova, which operates out of Bozeman, Montana, and facilitates purchasing of outdoor equipment and placing it on installment plans. On Daniel Defense’s website, they even offer a special deal, where if you buy a firearm on credit with Credova, you are automatically entered in a raffle to win $15,000.

Buy-now/pay-later consumer financing companies such as Credova allow customers the option of paying in installments when the arrive at the checkout process, instead of having to pay the full amount immediately, These arrangements are a part of special deals they work out with the retailers. Retailers have flocked to the service in recent years, finding they improve sales numbers. Meanwhile younger customers see these arrangements as a readier means of financing than obtaining a credit card.

Many of these companies allow the customer to simply split the full payment into four interest-free installments. In Daniel Defense’s deal with Credova, it appears Credova will only offer the financed amount interest free for three months. Afterward, interest charges will begin to accrue. However Credova has previously indicated it has a four-payment installment plan “coming soon.” Like most such companies, Credova has said it offers its service based on fees paid by retailers, and not fees charged to customers.

The bigger names in the consumer financing sector avoid firearms sales. Affirm Holdings Inc., Block Inc.’s Afterpay, and Swedish lender Klarna all will not work with firearms retailers in the US. US. Affirm and Afterpay even extend the ban to other products, including fireworks, drug paraphernalia, e-cigarettes, and tobacco.

Other smaller companies however will work with firearms retailers. Minneapolis-based Sezzle Inc. works with a number of retailers in the firearms and firearms accessory market.

For its part Credova has carved out a niche for itself focusing on outdoor sporting goods. It lists 37 stores it works with on its website, which are labeled hunting stores. Credova Chief Revenue Officer Kamron Davis said in an interview, “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.”

One Virginia manufacturer and retailer, SafeSide Tactical, began working with Credova in 2019. Mitchell Tyler, SafeSide’s co-owner and vice president said, “That was before buy now, pay later was mainstream, right at the cusp of it. 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 it began its relationship with Credova, SafeSide only offered layaway, where a customer had to make all the payments before taking possession of their purchase. Tyler emphasizes this has no relationship to the overall nature of the purchase, with all firearms sales undergoing a national background check and pickup of the firearm occurring onsite with verification of ID, even if the purchase is made online.

Credova’s Chief Executive Officer, Dusty Wunderlich, said in a trade interview, “We consider ourselves a financial technology company. What a lot of financial technology companies are doing is trying to make the customer experience easier.”

In many ways, purchases of firearms occur much like purchases of any other consumer good. For its part, Credova says consumer financing of firearms represents a small portion of overall firearms purchases, with the vast majority being purchased with credit or debit cards. And all commercial purchases of firearms, on credit or not, require presentation of a government photo identification, completion of an ATF form 4473, a federal NICS background check, and an in-person transition with a Federally Licensed Firearms dealer at a physical store location before a customer can take possession of the firearm.