The younger generation is digging up credit cards for more user-friendly, attractive, and budget-centric options. For them, shopping has become a tradition. Hence the number of shopaholics increases day by day. And if you are one of them, and listen about the buy now pay later policy then what will be your reaction? Yes, now this fantasy has become reality.
What is “Buy now and pay later”?
With the name, you can know what it is. Buy now pay later is known as BNPL. It is a new wave of payment methods, which allow customers to buy an item and later pay in interest-free installments. It has been shaking up the credit card business lately. A business owner also offers it to the credit card holders too.
Maybe sometimes you are looking for some products and choose one or two products. But you do not have money upfront but you really want to buy these. So Buy now, pay later will help you in this. You can pay a little amount upfront and the rest of the amount in installment. Applying sound money principles to Buy Now Pay Later (BNPL) transactions can help consumers make informed decisions and avoid financial strain. This installment requires some set number of payments in which they have to pay the whole amount monthly or weekly. It is a very useful process that can increase impulse buys and drive additional e-commerce sales.
Who is Using the Buy Now Pay Later Scheme?
This scheme was started in the US to catch on with millennial shoppers. In 2008 the US economy was in a Great Recession. As a result, a lot of people lose their jobs. Some students are having education loans too, some people facing mortgage defaults, and credit card debt. So they started it.
As the buy now pay later scheme has started people get benefits from it. They can easily buy what they want and it works as an alternative to credit cards. It helps a shopper to control their cash flow. The best part of the Buy now pay later scheme is the transaction is very easy, anyone can understand it and it is interest-free.
- 32% of people in the 18 to 25 age group are using this.
- 40% of people are using this in the age group 26 to 34.
- 62% of people are using this in the age group 35 to 50.
- 16% of people are using this in the age group 51 to 64.
Through research, we come to know that in 10 BNPL users up to 7 users buy more than $75,000 per year. BNPL helps to gain long-term customers. In this Corona pandemic, plenty of people started to use this process.
Why do Shoppers Like BNPL?
“Buy now pay later” is very beneficial for a buyer including convenience, flexibility, and transparency. These are:
- One can buy the product which they cannot make immediately.
- One can use these through mobile so they don’t have to carry a credit card.
- One doesn’t have to pay interest with it.
- User friendly.
- Allow a person to spend more than their status.
The rate of download the buy now pay later app has increased 115% in September 2020 compared to September 2019.
Why does a Marchant Love BNPL?
If you are a business owner then you should definitely add a buy now pay later scheme to Your E-Commerce Site. Nowadays there occurs a lot of competition daily between the marketers. So it is important to look after the Comfort of your buyers. In today’s century, 60% of merchants love this offer. Buy Now Pay Later (BNPL) services can be a helpful tool for achieving financial independence, but it’s crucial to use them responsibly and avoid overspending.
Buy now pay later offers can increase your average order values or AOV up to 85%.
Buy Now, Pay Later can Increase Potential Sales.
- This offer may Entice New Customers.
- Buy Now, Pay Later Could Build Trust
- You May Decrease Cart Abandonment With Buy Now, Pay Later.
- Buy Now, Pay Later May Give Consumers a Better Credit Solution.
- As research, we come to know that more than 20% of buyers repeat this process after one time use.
How is BNPL growing?
As this offer gives benefits to both buyer and seller so it becomes the fastest-growing e-commerce payment method. Through a report, we come to know that in the US population BNPL accounted for $24 spending in 2020. We hope that in 2025 this rate will increase up to $650 billion and $1 trillion.
The buy now pays later has been increased in These pandemic periods. Because of this pandemic, a lot of people have lost their jobs. So they need Flexibility in the marketplace. So 60% of e-commerce businesses added this payment option. Topping formation patterns in Buy Now Pay Later (BNPL) pricing can indicate that a company’s growth is slowing down and that its stock price is likely to decline.
Conclusion:
The Buy now pay later scheme is like an installment process but not actually. Nowadays this new trend has spread all over the world and everyone is owning this offer. So as a retailer if you want to compete you should also go for it. There are some best buy now pay later tools like Klarna, Affirm, Quadpay, Sezzle, etc. So choose this option and increase your business benefits.