Sonika Patel's Portfolio Website

Block / Enhancing Term Loans

Improving Term Loans Education

Clarifying ambiguity around a new type of loan and sensitive financial information for sellers

Square Loans

Deposited just now

$10,000

Overview

Sellers became eligible for loans paid back in fixed monthly payments called Term Loans, a new offering unique from the Flex Loan product, paid back as a percentage of daily sales, based on their processing with Square. The team originally launched a product experience for small businesses that introduced the new type of loan, consent to provide credit information, and convey an accurate loan offer to sellers, all within the initial screen. This clunky experience caused confusion amongst sellers who would continuously complain about loan eligibility and confusion around a new type of loan.

Role

Product Strategy

User Research

Team

UX Researcher

Content Writer

Timeline

4 weeks

Impact

Enhanced seller education

Improved conversion on term loans

The Problem

The existing Term Loans product was inundated with disparate information.

The original Term Loans onboarding experience overwhelmed sellers with excess information coupled into a singular screen, leading to confusion about the loan type, offer amount, and use of their FICO data. I led a redesign focused on clearer seller education, helping users confidently understand how their information impacts loan offers, ultimately improving trust and engagement for small businesses choosing Square Loans over competitors.

Discovery

Why are sellers not taking out Square loans?

Existing Experience

I collaborated with Duaa, the Banking team's user researcher, to uncover sources of confusion in the existing term loans product experience. While some sellers simply didn’t need a loan at the time they received an eligible email in their inbox, those who were interested struggled to understand the offering for 3 key reasons:

1. Sellers were confused that a soft credit check can only positively impact their offer.

2. Sellers complained about not knowing what was new within Term Loans product and understanding what was different from their core Flex product.

3. Confusion around the accurate size of their loan offer.

I paired with the user researcher on understanding where the confusion lie.

1. Sellers were confused that a soft credit check can only positively impact their offer

2. Sellers complained about not knowing what was new within their product and understanding what was different from their core Flex product

3. Confusion around the accurate size of their loan offer

Explorations

After identifying key complaints from sellers, I explored a variety of solutions addressing the education gaps, ranging from a guided flow, a banner introducing the new product, offer page to start with the higher loan offer, and adding an additional step to the product funnel. Loans drive significant revenue at Square, so balancing seller needs with business outcomes was crucial in this redesigned Term Loans experience. In each of the explorations, I balanced education of the 3 key issues, ensuring sellers weren't overwhelmed by understanding a new product, how their FICO information would be used, and the marketed size of their loan offer.

Using a Psyche Framework

We evaluated each solution to ensure information was presented in a transparent way, without overwhelming users with excessive input steps at any point in the funnel. Applying this framework allowed us to cross-functionally evaluate solutions, ensuring sellers understood getting a Term Loans product, from awareness about eligibility to FICO consent and ultimately selecting an offer.

Solution

The Optional FICO Linking Flow

Revised Experience

Optional

Mandatory

By allowing sellers to link their FICO information, we can gather data on credit score sensitivity while offering them greater transparency into the factors influencing their loan offer. To sense sellers' perceptions around credit information, I paired with a user researcher on usability testing two key flows, starting with FICO optional and FICO mandatory screens. In the new experience, we intentionally added information that lets users know how the credit information will be used to support a larger loan offer.

Usability Testing

Seller Preferences

We evaluated both experiences across sellers in different GPV segments, A/B testing to understand their perceptions of the revised funnel. Overall, the language was intuitive, and sellers clearly understood they were being offered the lower range due to their credit score. Sellers echoed sentiments including:

When you give a range like $10,000-$50,000 and come back and say all I’m going to get is $10,000 the impression I’m going to get is that my credit wasn’t good enough.

Square is looking to check my credit score to see how dependable I am on paying back my loan….depending on what my credit score is at the moment… it would affect what I am eligible for.

Based on my credit, that’s all you’re going to offer me and that’s fine.

Outcomes

After rolling out the optional FICO linking score to a subsegment of Term Loan eligible sellers, we saw a positive impact from the control group that received the previous term loans product experience.

+18%

sellers went through FICO pull to view offer

+13%

of sellers who chose to FICO pull, accepted and got approved for their loan.