Cisco Systems' financing arm is coming to the rescue of customers during the COVID-19 coronavirus pandemic, which has brought the global economy to a standstill.
The tech giant on Tuesday announced its Business Resiliency Program, which will extend US$2.5 billion in financing to help businesses invest in the IT solutions they need to keep their businesses running and productive during these unprecedented financial times, Kristine Snow, president of Cisco Capital, told CRN.
"Customers are trying to reconcile between the IT investments they need to make to enable their businesses to continue with the economic pressures they are now facing," Snow said. "The Business Resiliency program allows customers to buy now, pay later."
Via the terms of the new Business Resiliency Program, customers have 90 days from the time the order is placed to start making payments on Cisco solutions. After that, customers only have to pay 1 percent of the total contract value of the cost of a new product or solution until 2021. From January 2021 and on, customers can then make a monthly payment based on the total financed amount and the remaining term of the contract, including 36, 48, and 50-month contracts, Snow said.
Cisco said that all its IT solutions are eligible for this program, including hardware, software and services, as well as up to five percent of partner- provided services, such installation or configuration, she said.
Partners, in the meantime, will still be paid on the typical schedule, regardless of whether their customer is taking advantage of the Business Resiliency Program, Snow said.
The program is meant to protect business and help partners hold onto their cash flow during the coronavirus outbreak. The virus has forced many businesses to either close their doors or send the majority of their workforces home. While many companies need IT more than ever to support a remote staff, economic uncertainty as a result of COVID-19 is putting pressure on their balance sheets, said Oliver Tuszik, Cisco's channel chief.
"Customers need a way to invest in IT while their core business might be struggling," he said. "The program allows the customer to invest in urgently-needed technology, without getting an immediate hit to their cash flow."
For partners, the Cisco Capital program has always provided a way for customers to adopt Cisco solutions without struggling financially, Tuszik said. The program has been super-charged as a result of the current environment, he added.
"We know that the demand for investment in IT will grow," he said. "Companies are learning that if they don't have an online version of their business model, they will not survive."
Cisco Capital, a business unit that offers payment options for partners in more than 150 countries today, is further supporting customers with Cisco Refresh, the tech giant's certified re-manufactured product portfolio. Cisco Refresh is now offering a wider range of products, as well as more discounts and promotions, to help customers and partners buy and offer more pre-owned products.
Interest in Cisco Refresh has grown by 2-3x per week as a result of COVID-19 impacting global supply chains, Snow said. Cisco Refresh solutions, like its existing portfolio of offerings, are also eligible for the Business Resiliency Program. The cost of Cisco Refresh solutions can be deferred by up to 95 percent until January 2021.
The Cisco Refresh program also includes the firm's own efforts it has made in de-commissioning its own telepresence and collaboration across its campuses. Cisco is refurbishing and sanitizing these units to be used to support healthcare organizations and hospitals across the country, Snow said.
The Business Resiliency Program is part of Cisco’s "second reaction" to the COVID-19 pandemic, Tuszik said. The company first extended free licenses and expanded usage counts at no extra charge for three of its security technologies to help strained IT teams and partners ready themselves and their clients for remote work. Cisco also expanded the capabilities on its free Webex offer in all countries where it is available, which include unlimited usage or no time restrictions and support for up to 100 participants. Cisco right now is providing free 90-day licenses to businesses who are not Webex customers through its sales team and Cisco partners.
Cisco also in March committed US$225 million in cash and product donations to support both global and local responses to the coronavirus.