The Buy Now, Pay Later offerings are a hot-button topic these days. The market is growing rapidly. Based on a recent survey in the field, in July 2020, BNPL offers rose by 197% from Q2 of 2019 to Q2 of 2020. Globally, the volume of BNPL offerings is forecast to double by 2025. Are you interested in this type of payment options? Do you need a high risk merchant account?
What You Didn’t Know About the BNPL Market
The percentage of Gen Zers in the U.S. relying on BNPL has increased six-fold: in 2019, it was 6% in 2019, and in 2021, it is 36%.
However, the BNPL space is surrounded by different views. E.g., 55% of consumers has recently reported spending more money when using BNPL at checkout as compared to another payment type. 79% have reported they’d rely on BNPL options more often if more merchants offered such options.
Let’s go through some other views concerning the blind side of BNPL.
- Overspending & Falling Behind on Payments
Apart from the thoughts on spending more through BNPL services, making impulse purchases, and becoming unable to repay, easy checkout processes are another factor accounting for overspending.
- Consumer Uncertainty
A group of consumers has equated BNPL to irresponsibility. Another group has described BNPL services as great. 85% have reported to be planning to use BNPL in the upcoming years.
- Why Merchants Should Offer BNPL Options
Companies report a decrease in cart abandonment rates and view this fact as the main reason why merchants should go for BNPL services.
By the way, are you offering the right payment services to your customers? Consider applying to an expert merchant processor to get the best for your business needs. No matter you need a low or high risk merchant account, a reputable payment processing company will offer you the most secure and cheapest possible services in the industry.
- Don’t Lenders Benefit?
There are some views concerning lenders making less money from BNPL transactions because of the current business model.
- The Field Isn’t Properly Regulated
The BNPL market lacks proper regulations for operation, which can’t be said about the heavily regulated credit card industry.
The Blind Side of BNPL
More and more financial institutions are offering BNPL features with their other credit card offerings. The BNPL market is rapidly growing and attracting more customers. However, there are varying views on these offerings that you should be aware of.
Author Bio: Blair Thomas has been a music producer, bouncer, screenwriter and for over a decade has been the proud Co-Founder of eMerchantBroker, the highest rated high risk merchant account processor in the country. He has climbed in the Himalayas, survived a hurricane, and lived on a gold mine in the Yukon. He currently calls Thailand his home with a lifetime collection of his favorite books.