On Tuesday, Cisco announced a new $2.5 billion financing program to help its customers and partners stay afloat during the coronavirus pandemic. The new Business Resiliency Program gives Cisco's customers some breathing room by deferring 95% of their payments until the start of 2021.
The program, which is being offered through Cisco Capital, includes an up-front 90-day payment deferral. The new program enables Cisco's customers and partners to better serve their own customers without incurring upfront debt to their financial situations. It also helps Cisco stand out amongst its competitors, which include Juniper Networks, Arista Networks and Huawei.
In January of next year, customers would start to make monthly payments based on the total financed amount and the remaining term of the financing.
Cisco said the new program provides organizations with access to the solutions they need to keep their businesses running and productive and their employees safe. As entire workforces do their jobs from home, they need additional virtual private networking software or video conferencing tools such as Cisco's Webex and AnyConnect.
The program covers all of Cisco's hardware, software and services as well as up to 5% of provided services, such as installations.
In order to take part in the program, Cisco's customers need to have their orders in by July 25. Once the orders are placed, they won't need to make a payment for three months and then pay 1% of the money owed in each of the last five months of this year.
"Cisco's customers and partners are under enormous pressure to keep their businesses connected while remaining productive and secure," said Chuck Robbins, Chairman and CEO of Cisco, in a statement. "Whether it's technology, financing or helping those most in need, Cisco is committed to working together to fight this pandemic on every front."
The program also supports Cisco’s 60,000-partner ecosystem by helping those partners provide an additional solution to better serve their end customers without any change to their own financial situations. Cisco said this would accelerate the partners' sales cycles and in turn allow them to offer their customers payment solutions to better manage their cash flows.
The program will be initially available in 19 locations, including the United States, Greater China, India and Germany.
Last month, Cisco announced it was committing $8 million in cash and $210 million in product as part of its global coronavirus aid.