Why Offer BNPL To Your Ecommerce Customers?
As an online business, giving customers the best possible experience is likely one of the highest priorities. It’s not just about their journey on an e-commerce website – when they reach the checkout page, customers want to enjoy a fast, safe and secure process. They also like plenty of payment options and one of the newer payment options is Buy Now, Pay Later (or BNPL).
Fast growing in popularity, Buy Now, Pay Later payments are getting bigger every day and by 2026, it’s expected they will account for almost 25% of global eCommerce transactions. That data in itself is enough reason to offer it to customers – but of course, there are many other great reasons why merchants should include it as one of their online payment methods.
What is Buy Now, Pay Later?
In a nutshell, it’s a method that allows consumers to spread the cost of an online purchase – short-term credit usually with little or zero interest. The consumer can split their purchase cost into instalments and pay off the amount over a period of weeks or a few months.
The only fees attached to BNPL for consumers are possible interest (although not all BNPLs add interest), and fees or interest on overdue payment. In the UK, there’s ClearPay, Klarna, Laybuy, PayPal Pay in 4 amongst other BNPL services.
Here are some more reasons why it’s worth offering customers the BNPL option:
- The forecast for BNPL is great! It’s expected that 69%+ of merchants will add it as a payment method by the end of 2023. Customers want online businesses to offer the most up-to-date websites, products, services and payment options – and if a merchant doesn’t offer it, customers could choose to use a competitor’s service instead. In fact, more than 9.5 million British people won’t buy from retailers who don’t offer BNPL.
- As more than 25% of global e-commerce transactions will involve BNPL by 2026, merchants must consider adding at least one service to their checkout process – or risk falling behind.
- One in two consumers have used Buy Now, Pay Later – that’s only going to get bigger and, nearly 70% of BNPL customers believe that the service could replace credit cards.
- People seem to prefer short-term credit, splitting payments rather than putting purchases on credit cards and incurring interest, especially as most providers don’t add interest except in the cases of late or non-payment.
- It’s quick and easy for customers, and for businesses. Payments made in instalments are automatically transferred from customers’ preferred method. Many customers look for convenience when buying and access to interest-free. Plus, of course, BNPL gives customers the ability to pay for goods that they can’t afford outright. The other bonus for customers is that they can try the goods before paying for them in full.
- More customers use BNPL for high-value purchases because they can spread the repayments so merchants could enjoy higher basket value by adding it to their checkout. In fact, according to this research from Finder.com - including Buy Now, Pay Later can encourage greater online sales by 30%!
To stay relevant in today’s digital world, it is imperative that merchants offer a full range of payment options including at least one Buy Now, Pay Later service or they risk losing custom to other e-commerce businesses that provide BNPL options.