Over the past year, buy now pay later (BNPL) financing has been heating up, becoming what is now arguably the hottest financing trend today. According to FIS’ The Global Payments Report 2021, BNPL is the fastest-growing online payment method globally. In fact, $995 billion is expected to be spent through BNPL options by 2026 (up from an estimated $226 billion in 2021), according to a recent report by Juniper Research.
Early FinTech movers like Affirm and Afterpay continue to own a large share of the BNPL market, but more traditional financial institutions have chosen to join the space and offer new products via partnerships with SaaS providers.
Needless to say, BNPL financing is where everyone wants to be—and should be—right now.
If you’re considering entering the BNPL market but aren’t sure what the best approach is, there are several BNPL partnership strategies between financial institutions, merchants and tech providers that have seen great success. While the core objective of these partnerships is the same—to provide consumers with flexible payment options—the success of these partnerships is greatly dependent upon the organization and its goals.
Here we break down the three most common strategic partnerships to help you determine which model may be the best fit for your financial institution.