You can split the cost of products irrespective of how small or big the payment size is. With BNPL services, you can pay for a product in installments that are also interest-free. Buy Now Pay Later can be referred to as a short-term financing plan.
It is becoming a popular payment option, especially for online shopping. The categories that let you pay in installments include electronics, fashion, accessories, home and furniture, beauty and health, etc. It is a flexible payment option with no extra cost.
The different plans in which you can clear the payments include –
- Three installments
- Six installments
- Twelve installments
The absence of interest, subscription plans, or hidden charges makes shopping for your favorite products an outstanding option. All you need is a valid debit or credit card, and you get done with it in a few clicks.
How Does BNPL Works?
Buy Now Pay Later may be different with different services. Each company has its criteria, and the installment plans may vary. You can opt for the BNPL plan at the checkout once you finalize your product. You can make a small payment for the first installment, around 25% of the total cost. You can clear the rest of the amount in series in an interest-free manner.
While credit cards also allow delayed payments, both are different. While credit cards might charge interest, BNPL arrangements are interest-free. You are informed about the upfront installment amount, making it easier to plan things.
It is vital to remember that not all purchases are eligible for BNPL. Also, there can be a limit on the financing amount. Many people find BNPL an attractive option for smaller online purchases. The arrangement has been available for a long-time, and with the rise of e-commerce, its use has become even more widespread.
Pros of BNPL
- BNPL is a convenient and disciplined approach to paying for a purchase in due course of time.
- It is usually interest-free and will be much lower than credit cards in case of interest rate.
- You do not require a high credit score to benefit from the BNPL arrangement.
- You can expect fast approval.
Why Is BNPL Becoming Popular?
Frictionless checkout payments are becoming an integral part of online businesses. Customers expect companies to provide them with flexible payment options. With BNPL, companies offer customers a flexible and convenient payment option. It is also highly beneficial from the business owner’s perspective.
When a business is paid upfront, it receives protection. When a company has numerous payment options, a wider audience is likely to reach them. It is especially true in the case of young individuals. About 11% of Gen Z shoppers opt for the BNPL method.
The customers receive a more convenient way to purchase a product with more flexibility. No additional processing fee or time is taken, making it a hassle-free option.
Customers will likely make a larger purchase when they can pay in installments. As a result, you will see an increased conversion rate. So, the BNPL can be referred to as a convenient and affordable way to get their favorite products.
Final Thoughts
The idea behind BNPL is to immediately provide customers with their required products without increasing the financial burden. It can be an appealing arrangement for someone who wants to avoid paying for a product at a time. However, learning about the consequences that follow when you cannot clear the installments is advised.
Go through the fine print before signing anything. Choose a reliable service provider that aligns perfectly with your business needs.
