Blue Ocean Strategy
for Other credit granting (ISIC 6492)
The 'Other credit granting' industry is ripe for Blue Ocean Strategy due to intense price competition (MD03), market saturation (MD08), and the pressure to innovate against digital entrants (MD01). There are significant populations of 'non-customers' (e.g., thin-file, gig economy workers, niche...
Why This Strategy Applies
Creating new market space (a 'blue ocean') by focusing on entirely new value curves, making the competition irrelevant. Focuses on value innovation.
GTIAS pillars this strategy draws on — and this industry's average score per pillar
These pillar scores reflect Other credit granting's structural characteristics. Higher scores indicate greater complexity or risk — see the full scorecard for all 81 attributes.
Eliminate · Reduce · Raise · Create
- Exorbitant fixed overheads for physical branches High operational costs translate to higher interest rates or fees, excluding cost-sensitive non-customers who prefer digital channels and reducing overall market reach.
- Sole reliance on traditional credit bureau checks These checks disproportionately exclude vast 'non-customer' segments (e.g., gig workers, new immigrants) who lack traditional credit history, hindering access and growth.
- Complex, jargon-filled loan agreements and disclosures Such agreements foster distrust and confusion, particularly among financially less sophisticated borrowers, creating unnecessary friction and increasing compliance costs.
- Penalty fees for minor, isolated late payments These fees often trap vulnerable borrowers in debt spirals and damage long-term customer relationships, adding friction rather than value or financial stability.
- Over-emphasis on FICO scores as primary credit metric While useful, over-reliance limits credit access for otherwise creditworthy individuals who don't fit traditional profiles, restricting market growth and innovation.
- Stringent collateral requirements for small to medium loans Reducing this barrier opens up credit to micro-entrepreneurs and individuals lacking substantial assets, fostering economic inclusion and expanding the addressable market.
- Lengthy, multi-stage manual application and approval processes Streamlining reduces customer frustration and dropout rates, leading to higher conversion and lower acquisition costs for non-traditional borrowers seeking efficiency.
- Aggressive, impersonal debt collection practices These practices harm customer relationships and brand reputation; a more empathetic approach can improve recovery while maintaining trust and customer lifetime value.
- Transparency and clarity of all terms, rates, and fees High transparency builds trust, reduces customer apprehension, and empowers borrowers to make informed decisions, especially for underserved segments often exploited by opaque practices.
- Speed and accessibility of digital credit application and approval Expedited digital processes cater to urgent financial needs and improve convenience for busy individuals and small business owners, crucial for competitive differentiation.
- Personalized financial guidance and literacy resources Elevating support beyond just credit helps customers improve their financial health, reducing future default risk and fostering long-term loyalty and responsible borrowing.
- Flexibility and customization of repayment schedules Tailoring payments to match irregular income streams (e.g., gig economy workers) significantly reduces default risk and enhances customer satisfaction and retention.
- Proprietary alternative data-driven credit scoring models Utilizing transactional data, behavioral patterns, and utility payments opens credit to the 'credit-invisible' segment by accurately assessing non-traditional risk profiles.
- Embedded credit-as-a-service (CaaS) within partner ecosystems Integrating credit seamlessly into commerce, education, or healthcare platforms creates new revenue streams and reaches customers precisely at their point of need.
- Holistic financial wellness platforms (beyond lending) Offering budgeting tools, savings advice, and investment opportunities transforms the offering from a simple loan to a comprehensive financial partnership, building customer loyalty.
- Proactive financial health monitoring and early warning systems Implementing AI-driven tools to anticipate potential payment difficulties allows for early intervention and customized support, preventing defaults and strengthening customer relationships.
This ERRC combination creates a 'Financial Empowerment as a Service' value curve, unlocking vast 'non-customer' segments like gig workers, new immigrants, and micro-entrepreneurs currently excluded. These customers would switch because the new offering provides accessible, transparent, and flexible credit solutions seamlessly integrated into their daily lives, coupled with proactive financial support that prioritizes their long-term well-being over short-term profit extraction.
Strategic Overview
The 'Other credit granting' industry (ISIC 6492) is often characterized by intense competition (MD07), commoditization of products, and eroding profit margins (MD03). Many players are stuck in a 'red ocean' of head-to-head competition, primarily differentiating on price or marginal improvements. Blue Ocean Strategy offers a powerful alternative by focusing on creating entirely new market space, where competition is irrelevant. This involves identifying and serving 'non-customers' – individuals or businesses currently underserved or excluded by the market – and redefining the value proposition of credit itself.
For credit grantors, this strategy is particularly relevant given challenges like market saturation (MD08), the need to identify untapped growth niches, and maintaining competitiveness against digitally innovative entrants (MD01). Instead of competing for existing demand, a blue ocean approach encourages credit grantors to look beyond traditional credit scoring models (DT01), conventional distribution channels (MD06), and existing product definitions. It pushes for value innovation – simultaneously pursuing differentiation and low cost to create a leap in value for both customers and the company.
By systematically eliminating and reducing elements that are common in the industry while raising and creating new value, credit grantors can develop offerings that serve new customer segments or entirely new needs. This could mean embedding credit into non-financial services, developing alternative lending models, or providing holistic financial wellness solutions. This not only opens up new revenue streams and higher profit margins (MD07) but also positions the credit grantor as an innovator, setting new industry standards and potentially reducing regulatory scrutiny by serving previously ignored populations (CS07).
5 strategic insights for this industry
Vast Unserved 'Non-Customer' Segments
Traditional credit models often exclude large segments of the population and small businesses due to lack of traditional credit history, unstable income streams (e.g., gig economy workers), or niche industry classifications. These 'non-customers' represent a vast blue ocean (MD08) waiting for innovative credit solutions that leverage alternative data (DT01) and flexible repayment structures.
Credit-as-a-Service (CaaS) as a New Value Curve
Instead of standalone loans, the industry can create blue oceans by embedding credit directly into other value chains. For example, offering 'Buy Now Pay Later' (BNPL) options seamlessly at e-commerce checkouts or integrating equipment financing directly into a vendor's sales process transforms credit into a utility, creating new distribution channels (MD06) and customer experiences.
Redefining Risk Assessment Beyond Traditional Metrics
The reliance on FICO scores and collateral often limits credit access. A blue ocean approach forgoes this by developing new risk assessment frameworks utilizing behavioral data, cash flow analytics, utility payments, or even social network data (DT01). This allows for responsible lending to previously 'high-risk' but creditworthy individuals/entities, creating a new market for inclusive finance.
Value Innovation Through Elimination & Creation
Many elements of traditional credit granting are sources of friction (e.g., lengthy application forms, slow approvals, hidden fees). A blue ocean strategy eliminates these pain points (e.g., instant approval, transparent pricing) and creates new value propositions such as integrated financial literacy tools, personalized repayment plans, or credit-building mechanisms, moving beyond price competition (MD03).
Ecosystem Collaboration for Holistic Financial Wellness
Instead of merely granting credit, 'Other credit granting' can partner with fintechs, education providers, or community organizations to offer holistic financial wellness platforms. This positions credit not as a standalone product but as part of a broader solution, attracting customers seeking comprehensive financial support rather than just a loan (MD05, CS07).
Prioritized actions for this industry
Conduct 'Non-Customer' Research and Develop Empathy Maps
Systematically research and understand the reasons why non-customers (e.g., gig workers, specific underserved SMEs) are not currently served by the credit market. Develop empathy maps to identify their pain points, unmet needs, and desired outcomes, which can inform entirely new product development, addressing MD08.
Pioneer Embedded Finance Solutions with Non-Traditional Partners
Collaborate with e-commerce platforms, software-as-a-service (SaaS) providers, or industry-specific marketplaces to embed credit offerings directly into their user journeys. This creates new distribution channels (MD06), reaches new customer segments, and establishes a 'credit-as-a-service' model that bypasses traditional competition, addressing MD05.
Develop Alternative Data-Driven Credit Scoring Models
Invest in capabilities to analyze non-traditional data sources (e.g., utility payments, rental history, open banking data, cash flow analytics for SMEs) to assess creditworthiness. This enables responsible lending to underserved segments (MD08) and mitigates information asymmetry (DT01), opening entirely new markets without traditional competition.
Apply the 'Eliminate-Reduce-Raise-Create' (ERRC) Grid to Core Offerings
Systematically analyze existing credit products to identify elements to: (1) eliminate (e.g., lengthy paperwork), (2) reduce (e.g., approval time), (3) raise (e.g., transparency, speed), and (4) create (e.g., financial literacy tools, personalized advice). This shifts focus from incremental improvements to value innovation, directly addressing MD03 and MD01.
Launch an Internal Innovation Lab with Dedicated 'Blue Ocean' Mandate
Create a cross-functional team with a clear mandate and autonomy to explore, prototype, and test truly innovative credit solutions for non-customers. This ring-fences innovation from daily operational pressures and fosters a culture of experimentation, addressing IN03 and IN05 while allowing for higher investment risk in untested innovations.
From quick wins to long-term transformation
- Identify one specific 'non-customer' segment (e.g., freelancers) and conduct qualitative interviews to understand their credit pain points.
- Pilot a simplified, digital-first micro-loan product for a small, clearly defined underserved niche.
- Partner with a single e-commerce platform for a basic 'Buy Now, Pay Later' (BNPL) pilot integration.
- Develop a new, alternative credit scoring model for one specific blue ocean segment, leveraging new data sources.
- Establish an internal 'Blue Ocean' task force or innovation unit to systematically apply the ERRC framework to core products.
- Secure seed funding or a dedicated budget for a blue ocean project, demonstrating commitment (IN03).
- Transform into an 'embedded finance' provider, offering CaaS across multiple industries and platforms.
- Achieve regulatory clarity and acceptance for new, alternative lending models, potentially influencing policy (IN03).
- Cultivate a company-wide culture of value innovation, with blue ocean thinking integrated into strategic planning (IN05).
- Lack of executive sponsorship and organizational courage to pursue new, unproven markets.
- Underestimating regulatory hurdles and compliance costs associated with novel lending models (IN03).
- Failing to adequately research and understand the needs of 'non-customers,' leading to misaligned products.
- Internal resistance from existing departments whose 'red ocean' business models might be threatened.
- Insufficient funding or 'patient capital' for long-term R&D and market development (IN04).
Measuring strategic progress
| Metric | Description | Target Benchmark |
|---|---|---|
| New Market Share Captured | Percentage of customers or revenue gained from previously unserved or non-existent market segments. | 1-3% in year 1, growing to 5-10% in year 3 |
| Revenue from New Products/Services | Total revenue generated from offerings specifically developed under the Blue Ocean Strategy. | 10-15% of total revenue within 3-5 years |
| Profit Margins on Blue Ocean Offerings | Gross or net profit margins achieved on new products, expected to be higher than red ocean competitors. | 15-20% above industry average for traditional products |
| Customer Acquisition Cost (CAC) for New Segments | Cost to acquire a customer in a newly created market space. | Lower than CAC for existing, competitive markets (e.g., 20% lower) |
| Number of Strategic Partnerships Formed | Quantity of collaborations with non-traditional entities for embedded finance or ecosystem solutions. | 3-5 partnerships annually |
| Customer Lifetime Value (CLTV) for New Customers | Projected long-term value generated by customers acquired through blue ocean initiatives. | Higher than CLTV from traditional customer segments |
Software to support this strategy
These tools are recommended across the strategic actions above. Each has been matched based on the attributes and challenges relevant to Other credit granting.
Capsule CRM
10,000+ customers worldwide • Includes Transpond marketing platform
Transpond's email marketing and audience tools support proactive brand communication that builds customer loyalty and reduces churn-driven reputational fragility
Cost-effective CRM for growing teams — manage contacts, track deals and pipeline, build customer relationships, and streamline day-to-day work. Paired with Transpond, a dedicated marketing platform for email campaigns and audience management.
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HubSpot
Free forever plan • 288,700+ customers in 135+ countries
Deal intelligence, win/loss analytics, and pipeline data give sales teams the evidence to defend price with ROI proof rather than discounting reactively against commodity competition
All-in-one CRM and go-to-market platform used by 288,700+ businesses across 135+ countries. Connects marketing, sales, service, content, and operations in one system — free forever plan to start, paid tiers to scale.
Try HubSpot FreeAffiliate link — we may earn a commission at no cost to you.
Kit
Free plan available • Email marketing built for creators
Industries dependent on gatekeeping intermediaries — retailers, aggregators, or platforms — for customer access are structurally exposed to channel withdrawal; Kit builds an owned distribution channel that survives partner changes and platform restructures
Email marketing platform built for creators and solopreneurs — grows and monetises audiences through automations, landing pages, and segmented broadcasts. Formerly ConvertKit.
Start Free with KitAffiliate link — we may earn a commission at no cost to you.
Bitdefender
Free trial available • 500M+ users protected • Gartner Customers' Choice 2025
Endpoint protection prevents malware, ransomware, and data exfiltration at the device level — directly protecting data integrity and continuity of business information systems
Enterprise-grade endpoint protection simplified for small and medium businesses. Multi-layered defence against ransomware, phishing, and fileless attacks — with centralised management across all devices. Gartner Customers' Choice 2025; AV-TEST Best Protection 2025.
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Other strategy analyses for Other credit granting
Also see: Blue Ocean Strategy Framework