Adobe Analytics reports BNPL orders in the first two months of 2023 were up 10% year-over-year, with big jumps in home furnishings and grocery spending. Despite lots of noise about BNPL credit reporting, it’s still a rare phenomenon as operators and credit bureaus struggle with the complex credit scoring framework. SMBs find BNPL installment payments can be a lifeline in paying supplier invoices while retaining cash flow.
Fortune is out with a look at its five top suggestions for BNPL providers for consumers. Sift research shows BNPL saw a massive 211% increase in fraud in 2022. Buy now pay later operators increasingly use AI to reduce fraud and make better underwriting loan decisions. In the Philippines, Atome launched BNPL in more than 600 retail outlets. Lots going on in the installment loans business around the world!
Adobe Analytics — Buy now, pay later usage driven by home furnishings and groceries
Rising costs of living have pushed consumers toward buy now, pay later services that allow them to pay for purchases over time. In 2022, the share of online purchases using BNPL grew by 14% YoY, with revenue from BNPL growing 27% YoY. In the first two months of 2023, BNPL order share was up by 10% YoY, though revenue fell by 19% YoY, indicating that consumers are using it for smaller purchases. In the first two months of 2023, groceries’ share of BNPL orders grew a staggering 40%, home furnishings grew by 38%, apparel only increased by 8%, and electronics fell by 14%. Adobe Analytics
BNPL remains mainly absent from consumer credit histories
Buy now, pay later loan information is still not widely reported to credit bureaus, more than a year after those firms announced efforts to collect such information. They said current credit scoring models are incompatible with the new loan type, and credit bureaus’ attempts to collect that data and incorporate it into consumers’ credit histories have fallen short thus far. A lack of action points to the complexity of fitting the burgeoning payment method into the traditional credit scoring framework. PaymentsDive
BNPL helps suppliers avoid waiting for the check in the mail
B2B payments total $25 trillion annually in the US and $120 trillion globally. For many, implementing BNPL could prove a lifeline, allowing them to make a supplier payment in installments rather than a lump sum. B2B BNPL offers companies the same benefits as consumer-focused BNPL, increasing the affordability of the inventory they need to stay in business. PYMNTS
The 5 best buy-now, pay-later apps for March 2023
According to a report by the Consumer Financial Protection Bureau (CFPB), between 2019 and 2021, the number of BNPL loans originated in the US by the top five lenders grew by 970%. The Fortune Recommends™ editorial team reviewed a few of the most popular BNPL platforms. We weighed annual percentage rates (APRs), late fees, loan terms, mobile app ratings, and more to help you decide if BNPL is worth it. Winners? Sezzle, Zip, Klarna, Afterpay, and PayPal. Fortune
Report: Sift finds fraudsters are targeting fintech, digital goods & services—and recruiting consumers
Payment fraud cost online businesses $41 billion globally in 2022. Those losses are expected to jump 17% in 2023, hitting $48 billion by the end of this year. Nearly one in five (16%) consumers admit to committing, or know of someone who has taken part in, payment fraud. Within fintech, BNPL merchants faced a massive 211% increase, and crypto exchanges saw a 45% surge, while a 27% uptick in payment fraud hit digital goods & service providers. GlobeNewswire
Buy now/pay later fintechs lean on AI to survive the banking crisis
The recent banking crisis adds even more pressure on buy now/pay later lenders, which are taking steps to manage underwriting and credit decisions better. Many lenders want to limit the damage by using machine learning, which became more widely used during the past year as the BNPL industry faced financial and regulatory challenges. “We have found it to be a better predictor than [traditional credit scoring]. We also use another machine learning model for fraud to determine if consumers are real or not,” said Lee Brading, senior vice president of corporate development for Sezzle. American Banker
Suyen launches Atome buy now pay later across 600+ physical stores in Philippines
Suyen Corporation has partnered with leading BNPL provider Atome to offer flexible zero-interest payment options across its 20-plus retail brands in the Philippines. The retail company’s partnership with Atome covers 600-plus retail outlets, including fashion and lifestyle retailers Bench, Human, and Kashieca. It also operates franchise businesses for many international brands, such as Cotton On, Aldo, Charles &Keith, Jo Malone, Mothercare, American Eagle, and La Senza. Business Mirror
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BNPL Report – Mar 17: BNPL POS, Elyn, Tabit, Tamara, Hokodo, Afterpay, rankings, credit crunch