Buy Now, Pay Later: a Revolution in Payments
While online shopping has been democratized in an unprecedented way, consumers are still looking for the most secure and flexible payment options. In the age of coronavirus, Buy Now Pay Later solutions can remove some uncertainty around digital shopping. These new methods increase flexibility for the consumer while allowing them to build confidence with online merchants they may have never shopped with before.
Whether Klarna, Afterpay, PayPal, or Sezzle, the function of these payment platforms is similar: consumers get the product immediately without a full upfront payment. All they have to do is commit to a payment plan. Forget credit cards. This is the new way to finance online purchases.
The Payment & Digital Barometer survey carried out by Gallit on the most popular payment methods in France revealed that 30% of French consumers paid online with installment payments and 12% with a Buy Now Pay Later solution, also known as BNPL. It's also interesting to note that, according to the study, these consumers are primarily using neobanks, are aged 35 years old or younger, and are willing to try new payment methods.
While customers can see a benefit, why are so many brands providing this offering?
Allowing customers the possibility to spread out payments provides them with an increased ability to make a purchase. While this solution positively impacts every sale, it undoubtedly increases the likelihood of higher average transactions that a customer may have otherwise not been able to purchase at once.
As consumers are looking for options, stores providing them with a complete offering have a competitive advantage. With the increased adoption of BNPL solutions, ecommerces accepting these solutions are in prime positions to respond to the customers' needs and diversify their clientele. Klarna, leader of BNPL in Europe, developed an online catalog where consumers can know where they can buy using Klarna, and merchants can display their products on the Klarna App.
Being able to try before paying has never been easier. As its name suggests, buy now pay later allows customers a flexible way to do so without increasing the risk for online shops. Should customers like the product, they can keep it, and if that's not the case, they can return it without having paid anything. While this may increase the likelihood of returns, it lowers the barrier to purchase and relies on the product to “do what it says on the box.” Trusted brands should love this, as it should result in more purchases, increased trust, and improved loyalty.
BNPL is a much more affordable finance solution to cards for many consumers and may be a safer form of debt than credit cards or payday loans. As a merchant, you may also be concerned with what happens if consumers don’t pay? With Klarna integrated via Mollie, you are paid out five business days after the shipment of the product or after the first payment for Klarna Pay In 3 - installment solution. They also take the risk of the transaction in case a customer doesn't pay it.
Given the growing trend in BNPL and the benefits it can provide to your online store and consumers, it is highly likely that your competitors have already picked one or more solutions in this space, and if not, they probably intend to do so soon! This should not be the reason you lose customers to them… but the good news is that you don’t have to!
By implementing Klarna via Mollie, you get simplicity and flexibility. With our module for PrestaShop, you have easy access to the payment solutions your consumers love. You'll also get the easiest way to implement and manage this BNPL solution. With Klarna, you can offer the ultimate payment flexibility.
Implementing Klarna with Mollie doesn’t only give you a carefree implementation process. It also offers you transparent pricing and countless features to get the most out of your money management.
Whether you want to grow internationally or focus on a specific market, Mollie supports all major European payment methods, so you can build and grow your business wherever you want.