Hewlett Packard Enterprise (HPE) today committed to make more than $2 billion in financing available to its customers that are strapped for cash amid the COVID-19 pandemic. The move could boost purchases of HPE’s hardware and software in the short term, and thereby lessen the virus’ drag on its 2020 outlook.
The company’s financial arm, HPE Financial Services, is also rolling out a payment-relief program to help customers better absorb the costs of new technology. The initiative effectively follows a variable-interest model wherein required monthly payments will balloon next year.
Customers that take advantage of the financing can pay as little as 1% of the total contract value each month for the first eight months, and defer most of the cost to 2021, according to HPE. Starting in 2021, monthly payments will grow to 3.3% of the total contract.
While HPE’s customers will likely welcome the move and take advantage of the appealing financing terms, it also creates a safety net of sorts for HPE’s financial performance through 2020. The company earlier this week, like many others, withdrew its previously issued financial guidance and suspended share buybacks.
“This is a challenging time to lead a business. Today more than ever, IT leaders and CFOs play a central role in ensuring financial health while continuing operations,” Irv Rothman, president and CEO of HPE Financial Services, said in a statement.