Buy Now, Pay Later (BNPL)
What is BNPL?
Your customer wants to buy a new smartphone, but needs to spread the payment over 3 months. That designer dress is a bit beyond their budget just now but would be perfect for their best friend’s wedding. No problem. With Buy Now, Pay Later (BNPL) consumers can make purchases and pay in instalments spreading the cost over a few weeks, often paying no interest rate at all.

What’s the big deal?
Paying by instalment is not new. Mail order companies and department stores have been offering it for decades. The magic of BNPL is that providers offer shoppers credit online or at the point of sale as a seamless part of the customer journey, assessing creditworthiness in real time for each transaction.
Consumers can take their purchase home, allowing them to try before they buy. Merchants get their money upfront from the BNPL provider, minus a fee. Everyone’s a winner.
How merchants benefit.
Merchants have always known that when they make it easier for shoppers to pay, they will buy more. The breakaway success of BNPL confirms that. According to surveys, a BNPL option raises retail conversion rates 20% to 30% and increases average ticket sizes between 30% and 50%.[1] 38% of merchants report rises in customer loyalty and satisfaction.[2] Fees may be higher than credit cards, but you won’t hear many merchants complaining.
Compared to traditional consumer financing options, merchants can offer BNPL for shorter periods and for smaller items such as clothes and beauty products. In the US, McKinsey has found that 39% of BNPL users making a purchase would otherwise have paid with a credit card[3]. Younger shoppers love the option: 37% of Gen Z and 30% of millennials are reportedly users[4]. No surprise then that BNPL could be worth $1 trillion by 2025, according to JP Morgan.[5]
Challenges for BNPL providers.
What’s not to like? Well, BNPL came to the fore during the era of almost zero interest rates. Now that rates are on the rise and economic conditions are tougher, BNPL providers face higher funding costs and increased risks of consumer defaults.[6] However, regulators are stepping up their scrutiny of this sector to ensure high consumer lending standards are maintained.[7]
Solutions & who we serve
At Worldline, we believe that BNPL is here to stay. We have partnered with leading providers to bring BNPL to merchants around the world. Our Worldline BNPL aggregation service gives you access to multiple credit partners with a single integration. Worldline has also recently launched a new solution “Fly Now Pay Later” which is a BNPL solution dedicated to the travel industry.
Further resources
Find out more
Leila Van-Herbert
Jie Xue
[2] https://www.bain.com/insights/assessing-benefits-and-challenges-bnpl-report-2021/
[7] https://www.loyensloeff.com/insights/news--events/news/revision-of-the-consumer-credit-directive-consequences-for-buy-now-pay-later-services-and-private-lease/ https://www.consilium.europa.eu/en/press/press-releases/2022/06/09/consumer-protection-council-adopts-its-position-on-new-rules-for-consumer-credits/
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