Benefits of offering buy now, pay later
Leading merchants offering point-of-sale financing to customers can:
Experience higher conversions and lower cart abandonment
Offering flexible financing on purchases can significantly influence the way that consumers make decisions. According to a recent emerging payments report by Deutsche Bank, 46% of customers who made a purchase using BNPL responded that their business would have been lost with no BNPL solution, while 41% said they would have delayed their purchase. Offering point-of-sale financing can significantly increase conversion rates. In fact, according to that same study, merchants could benefit from as much as ~20-30% higher average ticket sizes and a ~30% increase in conversions.
Increase sales and funnel growth
Not offering financing can limit your ability to grow your customer base. By providing flexible payment options for potential customers, you have an opportunity to expand your customer profile into new markets by competing with merchants who are already providing financing opportunities. Reaching these markets will allow you to increase both immediate sales and funnel growth.
Improve customer experience
Consumers want ease. With point-of-sale financing at checkout, customers can select a flexible payment plan that works for them, complete credit risk assessments, and finalize their purchase all in a matter of minutes. Presenting your customers with affordable payment options means less time spent debating the purchase—if you can offer something that makes that decision and process easier, you have successfully created a frictionless customer experience.
Boost customer loyalty and retention
Offering flexible payment options is not only crucial to building a customer base, but it’s also important when it comes to actually retaining it. If you can present appealing financing plans and a seamless customer experience for your customers for one product or solution, chances of those customers being loyal and returning for repeat business are high.
Compete with online and in-store retailers
Buy now, pay later is on the rise and here to stay. This trending financing option gives consumers the opportunity to finance purchases in smaller amounts over time with more confidence in their ability to pay it off without the additional interest of using a credit card. Because of this, demand is high (to no surprise).
For the time being, it’s possible to compete with these merchants providing financing to their customers, but it could become near-impossible as buy now, pay later continues to become popular among younger generations. So the quicker your business is equipped to keep up with this trend, the more likely you are to stay in competition with your peers who are offering financing. And for the retailers who aren’t adopting buy now, pay later, you’ve got a one up on these competitors.