Shopping is one of the primary habits of humans, and often, we see ourselves short of cash at the right moment, like if a flash sale or good discounts is being given out. People often lose the opportunity to save huge by shopping during this offer period. During such times, Buy Now Pay Later services come in handy, and the customer won’t have to miss out on a good opportunity.
Buy Now Pay Later, short for BNPL, is a service wherein a customer can buy any product they want and pay the amount later in a series of installments which are primarily at a 0% interest rate. Buy Now Pay Later services are available for shopping for kids and shopping for women as well. This category has the most offers, and using BNPL service gives more purchasing power to the customers.
Buy Now Pay Later service is now gaining good traction, and it has been said that most Gen Z are using this instead of credit cards.
Buy Now Pay Later service has largely dominated the financial department as it has good flexible and affordable repayment options. The financial institutions that provide this service decide the repayment tenure during which the customer has to pay the amount in several installments.
Why Buy Now Pay Later services are flexible and affordable
- Low-Interest Rate – BNPL services provide low or zero interest rates to the loan amount, attracting many Gen Z and Baby Boomers to this service. The interest rate is applied to the loan amount if a customer fails to pay the EMI on the specified date. The interest rate which would be applied if a customer fails to pay back varies from vendor to vendor of BNPL service, and the customer should take note of the same as well.
- Easy Approval – Buy Now Pay Later services to have an easy approval process, wherein the financial institutions don’t check the customer’s credit score while giving out services. This makes it easy for Gen Z as they don’t have a good credit score at the start. Also, the KYC process is fully digital and can be done in one or 2 days, depending on the documentation uploaded by the customer.
- Repayment options – With Buy Now Pay Later service, the customer can repay the whole amount in a series of installments over a period or in one lump sum amount within the given time period. The repayment tenure can range from 6 to 24 months, depending on the vendor.
- Faster transaction period – Most people today have a smartphone with internet service enabled. With Buy Now Pay Later service, customers can complete the payment with just one click on their smartphone. This is one of the primary reasons why Gen Z has adopted this service quite faster as compared to credit cards.
- Better purchasing power – Getting the products at the right time would help save an individual a huge amount of money. Many stores provide sales or give out good offers, and sometimes these offers are at the end of the month. People miss out on these opportunities as they don’t have enough cash and have to wait until their salary is credited. With Buy Now Pay Later service, customer has better purchasing power, and they won’t miss out on such good offers and opportunities. Businesses have also stated that they are seeing 20 to 30% more order value from each customer during their offer period, thereby helping their business as well.
Buy Now Pay Later service has gathered a large customer base in a short span of time and is only expected to increase. Many large stores have already integrated BNPL services into their system and are encouraging buyers to use them. The ease and flexibility BNPL service provides are one of their biggest successes. It is said that Buy Now Pay Later services will soon replace credit cards in the long run and will be used by people of all ages as most of them are now well equipped with smartphones.