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Cisco Takes Service Financing to SMBs

The financing arm of Cisco Systems is adding another component to the company’s offerings for small and midsize businesses—a 4.5 percent financing program for Cisco Services targeted specifically at SMBs. The move follows several others by Cisco in its efforts to gain more business from the SMB segment—including product introductions aimed at SMBs and an […]

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Jessica Davis

May 9, 2007

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The financing arm of Cisco Systems is adding another component to the company’s offerings for small and midsize businesses—a 4.5 percent financing program for Cisco Services targeted specifically at SMBs.

The move follows several others by Cisco in its efforts to gain more business from the SMB segment—including product introductions aimed at SMBs and an entry level monitoring offering that VARs can offer to small business customers. Both initiatives were announced at the company’s Cisco Partner Summit in Las Vegas last month.

Cisco introduced a similar financing program for enterprise customers last year, letting them spread out over time payments for Smartnet and other subscription-based technical support services.

“While service contract programs such as Smartnet have been available to SMBs, putting this finance wrap on it makes it more affordable,” said Maryann Von Seggern, director of worldwide channels development. “It’s a recognition that SMBs are running their own mission-critical applications.”

Contract terms of such services require that customers pay upfront for the full subscriptions, which can run from 12 to 36 months long. That can add up significantly, particularly in the price-sensitive SMB segment.

Cisco Capital introduced its “Commercial” or SMB division two years ago, according to Von Seggern.

“Nobody did financing better than Cisco Capital, but we were terrible at supporting the SMB structure,” she said. “So we built an entirely separate transaction.”

The 4.5 percent financing for SMBs is only the most recent announcement aimed at SMBs this year. Cisco Capital recently introduced an accelerated credit request process that can return a “yes” or “no” answer to partners in just five minutes. And the company recently upgraded the Easy Lease program, doubling the amount that customers could finance for equipment leasing, from $50,000 to $100,000. Von Seggern said the organization is looking to increase that limit again, this time to $250,000.

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Cisco Takes Service Financing to SMBs

Jessica Davis

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