BNPL emerged as a notable trend in 2022 Black Friday shopping, jumping 78% over last year, but a Harvard professor waves a warning flag for consumers. PYMNTS looks into the challenges of BNPL for merchants and the potential upside. Singapore’s BNPL Bureau will be operated by credit reporting company Experian, definitely a sign of the future.
Cash preference dropped from 45% in 2020 to 35% for Swiss consumers in 2022, with similar trends across the EU. Swedish BNPL Gross Merchandise Value will increase from $24.4 billion in 2021 to $54.1 billion by 2028. Indian BNPL leader Zestmoney is a target of Walmart-backed PhonePe in a deal estimated at up to $300 million. Motley Fool picks the top six BNPL providers, and Wired looks at what makes BNPL work.
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Black Friday online shoppers embrace Buy Now Pay Later amid high inflation and recession fears but still drive sales to record $9.1 billion
High inflation and recession fears didn’t dampen online sales on Black Friday, which hit a new record of $9.1 billion on Friday, up 2.3% from a year ago. But consumers, already spending more on fuel, food, and other essentials, did embrace more flexible ways to shop online, according to data released by Adobe Analytics, which tracks retailers’ website sales. In the week of Nov. 19-25, Buy Now Pay Later (BNPL) revenue spiked 81% compared to the week before. And orders made using BNPL jumped 78%. Yahoo/Forbes
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PYMNTS Intelligence: The advantages and challenges of BNPL for merchants
57% of merchants offering BNPL said they improved conversion, countering one of the most common struggles e-tailers face in that most shoppers abandon their carts before checkout. Retailers also report quantifiable benefits in the form of increased brand awareness, with 53% of merchants saying that BNPL providers exposed their brand to new customers. 47% of merchants also reported an increase in average order value, which, combined with the improved conversion rates, leads to a hefty overall increase in revenue. PYMNTS
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Experian appointed to operate Singapore’s BNPL bureau
The Singapore FinTech Association (SFA) and the Buy Now, Pay Later (BNPL) Working Group appointed Experian to operate Singapore’s BNPL bureau. It will operate the BNPL bureau with all accredited BNPL players sharing users’ credit information – such as outstanding BNPL balances, missed payments and delinquencies – to facilitate creditworthiness checks by Experian. The data will be used by accredited players in providing BNPL services under the new BNPL Code of Conduct. Technode Global
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More Americans tapping buy now, pay later for holiday gifts shows ‘how stressed the economy is,’ Harvard researcher says
With prices near historic highs, more consumers are leaning toward buying now and paying later to afford their holiday shopping. On Black Friday through Cyber Monday, buy now, pay later payments through companies such as Klarna, Zip, Zilch, Affirm, and Afterpay jumped 85% compared with the week before, according to the most recent data from Adobe. “It means a merry Christmas, but in the long run, for many will hurt their credit,” says Marshall Lux, a fellow at the Harvard Kennedy School. CNBC
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Swiss prefer cash and buy now pay later equally
Switzerland is a country that has a long love affair with cash, but its use is dwindling, and buy now pay later (BNPL) has reached the same level of use in the country, according to a recent survey from strategy&, which is part of the PWC network. According to a study of people in 15 European countries in 2022, 35% of Swiss said that in paying for shopping purchases services, cash was their preference for people over 35. That figure declined from 45% in 2020 and 60% in 2018. Finews.ch
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BNPL payments expected to grow by 15.9% to reach $24.36 billion in 2022
BNPL payments are expected to grow by 15.9% annually to reach US$24.4 billion in 2022. The BNPL payment industry in Sweden has recorded strong growth over the last four quarters, supported by increased e-commerce penetration and the impact of economic slowdown due to disruption caused by the Covid-19 outbreak. The BNPL Gross Merchandise Value in the country will increase from $24.4 billion in 2021 to $54.1 billion by 2028. BusinessWire
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PhonePe to acquire ZestMoney for USD 200-300 million
According to sources, Walmart-backed digital payments company PhonePe is set to acquire buy now, pay later (BNPL) company ZestMoney in a deal pegged at $200 million- $300 million. After the acquisition, ZestMoney will continue to operate as a separate entity. It has over 17 million registered users and a network of merchants with over 10,000 online partners, including Amazon, Flipkart, MakeMyTrip and Nykaa. It is also present in over 75,000 offline stores. New Indian Express
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What’s the best ‘buy now, pay later’ service?
Here are a few things to keep in mind when exploring your options: whether the service does a soft or hard credit check; spending limits on purchases; repayment terms, including interest charges and late fees; and whether the service offers a virtual card. Here’s a table showing how six of the most popular BNPL services – Affirm, Afterpay, Klarna, PayPal Pay in 4, Sezzle, and Zip (formerly known as Quadpay) – compare on the following factors. Motley Fool
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How ‘Buy Now, Pay Later’ really works
With buy now, pay later, they’re offering a little bit of a longer-term loan. You could take as long as three months or something to pay for that item or others you want to buy for 0 percent. In many cases, the banks that are actually providing the loans, like Affirm, have these bank partners that most people have never heard of, like Cross River Bank or Celtic Bank. What you’re interfacing with is the tech platform Affirm, Klarna, and Afterpay, and they’re providing all of the payment services too. Wired