BNPL: the payment method that benefits merchants and consumers

How many times have you gone to the shopping centre to see if the computer you want so much is on sale, or visited the travel agency to see if your favourite destination has dropped in price? Buying our favourite products or traveling to our most desired places, is easier with the option of partial payment, now also increasingly common in e-commerce. 

During 2020, the amount spent by Spaniards on e-commerce purchases was particularly striking, with a volume of 51,600 million euros. The preferred payment method for users to pay for their purchases was the credit card, but nowadays it is increasingly common for companies to incorporate new payment methods, both in physical and online stores, highlighting partial payments, allowing consumers to pay the total cost of the product in several instalments. 

Instalment purchase is defined as the agreement between the buyer and seller for the purchase of a good or service in different parts over a specified period. In most cases it requires the payment of an additional interest to the amount, and this can be assumed by both the trade and the purchaser. Since the beginning of 2012 with the economic crisis and the cultural changes increased by the arrival of the pandemic in 2019, consumers have changed their consumption habits, so businesses have had to look for different solutions such as BNPL to maintain or increase their sales volume and build customer loyalty. 

Buy Now, Pay Later (buy now, pay later) is a payment formula that allows customers to buy in instalments in a very simple way. According to an article published in El Economista, this method has revolutionized the financial sector and is expected to reach a volume of 680 billion dollars worldwide by 2025. Thanks to this system, businesses offer customers the possibility of paying for their acquisitions little by little, choosing the months or the quantity of the instalment that best suits them, and thus being able to complete the payment whenever they want without penalties or extra costs. 

Consumers, by having the option of paying for an item or service in different instalments, can separate a large amount of money into several payments, so that the initial investment will not be so large and will make it easier to acquire the product. This may also reduce the pain of paying large amounts of money at once. 

This new purchasing method does not involve complicated procedures and one of its main advantages is that it does not generate additional interest for buyers. Likewise, it does not require exhaustive financial analysis by banking entities, which has made it a very popular method, especially in the young sector. 

Another of its advantages is that the purchase approval process can take as little as 0.2 seconds, a time interval in which the possible risks of the 

transaction are checked, so fast and secure purchases are certified with this method. 

As a seller, you can also benefit from payment in instalments. Dividing the amount to be paid on several times makes customers less hesitant to buy and may lead to an increase in their purchasing power, which will mean that your company’s profit will be greater. 

This system guarantees users flexibility when making payments, which will improve their shopping experience, their trust in the brand and their loyalty, which will increase the probability of future purchases. 

In short, customers are becoming more and more demanding and demand quality goods with good financing plans, both in the physical store and online. A good mode to present them is by offering the possibility of payment in instalments. At Sipay we can help you achieve this, and we also offer a wide variety of fast and secure payment methods so that you can adapt to the needs of your customers in all environments. 

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