What Are the Benefits of “Buy Now, Pay Later” Financing for Your Ecommerce Platform?
As eCommerce grows at a rate that is expected to exceed 20% this year, according to IBM’s U.S. Retail Index, vendors and marketplaces are attempting to entice customers with a shopping experience that includes an additional payment feature that will make it very easy to pay. Affirm, Klarna, Afterpay, Sezzle, Splitit, QuadPay and, most recently, PayPal Credit dominate the Buy Now Pay Later field (formerly BillMeLater). Despite its late entry into the market, PayPal clearly has a natural edge as an online payment provider that most businesses already offer. Pay in 4, which is part of PayPal’s array of pay later solutions, is accessible to customers who make transactions ranging from $30 to $600. CVS, Revolve, Nike, Levi’s, Urban Outfitters, and Expedia are among the major brands that provide these services through their eCommerce channels.
The Buy Now Pay Later phenomena has its origins in credit cards and old-fashioned financing programmes like layaway. However, unlike its predecessors, it feels like a win-win situation for both the buyer and the store as a contemporary one-click payment option. The buy now pay later model, which appears at the checkout, enables clients to finance lesser ticket items with no transaction or just a tiny starting payment and pay the remainder later in a few instalments at either minimal or no interest rates. Machine learning have enabled financial firms to lower the risk of fraud and default, and their clients profit from this because they now have a better grasp of the buyer’s credit profile without harming their credit scores.
The Buy Now Pay Later approach is utilised by shops that sell high-priced goods or by those who sell low-priced products but also want to increase revenue, cart capacity, reach new customers, and retain existing ones. Stripe, a QuadPay partner, believes it is not a great fit for firms offering services or software, or those concerned about costs, because fees are higher.
Its benefits for financing e-commerce, like buy now pay later shopify and more forth coming offers.
Increase in sale value: According to Klarna, the implementation of a BPNL function resulted in a 33 percent rise in the value of sales at its client GymShark. According to QuadPay, merchants that have adopted its BUY NOW PAY LATER product for e-commerce have witnessed a 20% boost in conversions and a 60% rise in average checkout value. It is a method of ensuring revenue without using methods such as discounting.
New consumers, increase in sales: Consumers who were previously unwilling to purchase things because the cost was out of their budget may be attracted by the Buy Now Pay Later option. BlackCool, a lifestyle business, claims that its sales have increased by 600% since launching its BUY NOW PAY LATER plans. Its CEO believes that it has attracted “various groups, including cost conscious consumers who may believe our quality goods are priced beyond of their reach. The suppliers, through their own community, will expose a store’s brand and products to millions of potential buyers.
Loyal consumers: Customers who are aware of the availability of this option on an eCommerce store and appreciate the seamless aspect of the customer experience are more inclined to come back for repeat purchases.
Integrating Buy Now Pay Later into the shop’s regular payment processes: The most significant barrier to Buy Now Pay Later implementation used to be the time-consuming procedure of directly integrating into the retailer’s point-of-sale system. Buy Now Pay Later services, on the other hand, are expanding its interfaces with existing eCommerce platforms like BigCommerce, Shopify Plus, and Salesforce Commerce Cloud to make it as simple as flipping a switch.
What is the future like for buy now pay later: As the use of seamless, contactless experiences and digital payments at the checkout in retail environments grows, so should the adoption of Buy Now Pay Later. According to the Global Purchases Report 2020 by Worldpay from FIS12, BUY NOW PAY LATER payment methods increased from 3% of all eCommerce payments in 2018 to 8% in 2019. Customers are increasingly getting provided BUY NOW PAY LATER services outside of eCommerce to pay for goods, and they may one day be as common as credit card payments.
Increases the value of an average order: Allow customers to purchase higher-ticket products and checkout out with bigger cart sizes.
Buying power increases highly: Allow buyers to raise their budgets and optimise their buying power by allowing them to purchase everything they desire.
Return of customers: Allow buyers to increase their budgets and maximise their purchasing power by enabling them to buy everything they want.
Makes checkout very easy: Allow your customers to safely speed past checkout with Buy Now Pay later, the internet’s fastest and best-converting checkout.
A perfect shopping experience: Reap the benefits of a completely integrated checkout solution that does not require any redirects or overselling.
Buyers may break their purchase into four equal, interest-free payments with Buy Now Pay later Installments, with no additional, hidden, or late penalties, and no influence on their credit ratings. Our ‘buy now, pay later’ solution is already proving to be a sales revenue conversion drive for collaborating Shopify merchants after only a few months.
Buyers who use Buy now Pay Later benefit from the smooth, faster checkout experience. Buyers aren’t routed from checkout since it’s the only completely integrated ‘buy now, pay later’ option on Shopify, unlike other instalments solutions. This eliminates the need for retailers to worry about overselling owing to restricted stocks or during flash promotions.
Returning instalments users can enjoy a 30% faster checkout experience with Buy Now Pay later Installments. Return consumers had a 69-second checkout time with our product, compared to a 104-second average checkout time with third-party instalments solutions. When compared to third-party solutions, Buy Now Pay later Installments has a 122-second average checkout time for first-time instalments users, vs a 167-second average checkout time for third-party solutions, making our ‘buy now, pay later’ product 27 percent faster.
When buyers use our product to begin the checkout process, we saw a 28 percent decrease in checkout abandonment for retailers who migrated from a third-party instalments solution.
A speedier and more seamless shopping experience keeps customers in the store and increases conversion.
Deposits is one of the many amazing features of Buy Now Pay Later, Shopify’s quickest checkout option. Merchants can also access into Buy Now Pay Later’ 60 million user base, which is a very active and engaged audience, through Buy Now Pay Later installments. This client base is by far the most broad among ‘buy now, pay later’ companies, consisting primarily of US buyers.
These customers are already taking advantage of the expedited checkout to take advantage of advanced features like one-tap payment, free carbon offsets, and shipment tracking on the Shop app. In addition to all of these benefits, consumers can now pay in four equal payments at participating stores that offer Buy Now Pay Later instalments.