BNPL (buy now pay later) is a type of financing allowing customers to shop for goods now and clear the payment over a few weeks or months in instalments. The biggest benefit of this system is that there is no interest or very minimum interest that is easily bearable by the customers.
The system is growing at a stellar rate because many a time, a customer wants to buy a product or service but they are incapacitated to pay the entire price on the spot. So, they prefer to divide the cost into a series of instalments. That is why, many ecommerce vendors are integrating this payment system in their payment mix and it increases the chances for your business to engage more shoppers and maximize their value.
In the following section, we shall explore more about BNPL, how popular it is, and how does it work. Without further wasting the time, let's dive into it.
BNPL Explained
As the name suggests, it is a financing scheme that allows consumers to shop for goods and services and pay later in instalments. Most times, these payments come with low or zero interest. Essentially, customers using this system can split their bills into multiple equal payments and the first due during the checkout. The remaining bill of the same is added to the bill of their debit or credit card until all the payments are cleared.
Know that BNPL is an alternate payment method to credit and debit cards and it can also cater to several payment types and channels. Today, the system of payment is one of the most consumer-friendly payment options.
How does BNPL work?
Merchants who wish to add this payment to their checkout process needs to sign in a contract with a BNPL provider. Once the contract is signed, BNPL services can be easily integrated into their payment mix and give customers an additional payment option to enhance their shopping journey.
Things can be finalized when the merchant has researched and assessed all the options and services the providers is offering.
It has been assumed that BNPL is set for exponential growth in the coming years. If you are an e-commerce merchant and want more and more customers to buy your offerings, it is time that you embrace a new payment system with BNPL. BNPL represents 5% of the global market share. Europe appears to the holding the highest share in BNPL services.
It is time that you start using a new method in your payment mix and ensure that not a single abandons your cart. Offering more payment options is always helpful.
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