Unlike traditional times, the modern customers are looking for seamless payment options to improve their checkout experiences. These days, several digital payment options like e-wallets, debit card and credit card payments, EMI payments, cash on delivery using digital payment apps, and more; allow customers to indulge in their preferred payment mode. And one such option is buy now, pay later (BNPL).
Amongst the top eCommerce trends, BNPL or Buy Now Pay Later is emerging as one of the popular financing services for the ease it offers to customers while shopping online. As customers don’t have to pay for products/services straight away, it ensures a hassle-free checkout experience for a customer and guaranteed revenue generation for a retailer.
What is BNPL?
BNPL or Buy Now Pay Later is a modern payment method where customers can purchase a product and pay for it in installments, often interest-free, over a set period of time, which is generally a few weeks or months. Also known as Point Of Sale (POS) installment loans, BNPL lets customers borrow money for a short term to order online and pay later in future installments.
The buy now pay later services are usually facilitated by third parties. Customers fill out a basic form with their details and register themselves with digital lenders like Hoolah (using Salesforce Commerce Cloud), Seedly, Rely, EarlySalary, ZestMoney, Atome, and more. These payment providers have a tie-up with the retailers and can make the payment to the merchant on customers’ behalf.
Subsequently, stores that offer buy now pay later options enable their customers to shop for products in advance and pay for them later via third party apps.
How is buy now pay later different from credit cards?
Quite honestly, the buy now pay later eCommerce solution does resemble credit card payments, but only in the type of service being offered. They are, however, quite different, as explained below: