Microsoft Expands Solution Credit Offerings

The U.S. Total Solution Financing program was launched in September 2002 with much fanfare at the annual Microsoft Business Solutions (MBS) partner conference. Solution providers there literally applauded the news that the program would bankroll not just Microsoft software but services, hardware and third-party software as well. Integrators and resellers hoped that the low-interest financing, backed by Microsoft Credit, would jump-start sales in a stagnant IT spending environment.

The financing was subsequently expanded to Germany, the United Kingdom, Netherlands, Spain, and now Canada. On Nov. 1, interest rates were cut.

At this year's converged MBS and Microsoft "Classic" partner conference in October, Microsoft CEO Steve Ballmer was asked during a Q&A about streamlining the financing offer. A solution provider complained about the program being bureaucratic and slow. Attendees applauded the question, indicating that others agreed about the red-tape factor.

Ballmer responded by asking the audience if financing was something Microsoft should even be involved with first hand, or whether it made more sense to use existing third-party credit providers. One thing is clear: Microsoft with its huge cash trove, definitely has the means to help partners with low-cost financing. As of September, Microsoft had nearly $50 billion in cash, even after it started paying out dividends.

It appears from this newest expansion that Microsoft is in the credit game to stay, at least for a while.