Buy Now, Pay Later’s Impact on Your eCommerce Business

Buy Now, Pay Later’s Impact on Your eCommerce Business

The Practice of “Buy Now, pay later” is not today’s practice. Many of the biggest purchases are done on this concept like cars, and houses in which a small amount of money is paid first and the remaining is paid later.

Buy now, Pay later” now changes to “Shop now, Pay later”. Many eCommerce owners have already implemented this method to attract an audience and make them buy things.

What is BNPL (Buy Now, Pay Later)?

Method of payments that allows buying products and paying later in the form of installments over a specific period. It helps in providing more flexibility to the users when they are provided with an option of paying later and it charges no interest.

How does BNPL Work?

This BNPL method has different terms and conditions. They generally offer short-term loans to the users with fixed payments but no interest. You can use a credit card for later payments.

You can make a purchase of the products from any participating retailer and choose for pay later checkout option. This method builds trust in the mind of users that it is possible to buy the products and pay the amount later.

If your request is approved for choosing this option, you can make a down payment of 25% of the overall amount and can pay the remaining in a series of free interest installments for over a weeks or months.

For further payment, the remaining payment automatically starts deducted from the credit cards, debit cards, or from bank accounts, you can do payment from bank transfer.

BNPL apps don’t charge any interest, they already have a fixed repayment schedule and each payment will be same over the time.

BNPL in eCommerce

The main reason behind the rising popularity of Buy Now, Pay Later is that it provides flexibility and convenience to the users to buy products and thus, helps increase eCommerce sales.

It can be implemented on eCommerce in three different ways given below.

  • Full payment in 30 days with no interest: In this method, the full payment of the product can be delivered within 1 month (30 days) with no interest included. This is the most straightforward method.
  • Short-Term Payment with Installments: In this method, users can pay short-term payments like little amount at first, and then pay the rest of the amount in the form of installments. It usually takes two weeks or one month apart.
  • Short Payment, Multi Installments but Change in Price: In this offer, the users can pay short payment with multi installments but the price can be differing.

For example, a user has to pay RS 6000 in one payment, and in three months he has to give Rs 3000 each, which later totals to 3000, which means the customer is paying Rs 3000 additional money for their purchase.

Importance of BNPL in eCommerce

BNPL turns out to be the most flexible payment method in eCommerce. It helps in modernizing the purchasing process and increasing buying ability of shoppers to help in moving bulk products.

  • Consumer Satisfaction: Customers around the world need flexibility in their purchasing method, after implementing BNPL in the services, Customer’s dreams started becoming true.
  • Repeating in Business: Users who want to buy products from the BPNL method will repeat their purchasing from the same business that provides this method which helps in user engagement and sales.
  • Quick and Simple Purchase Product: BNPL makes it quick and simple to purchase a product. Users can easily pay the remaining amount after purchasing the products

Here’re some examples of BNPL:

  • Charlotte Tilbury
  • Canyon Bicycles
  • Amazon Pay
  • After Pay
  • Sizzle
  • Pay Pal Pay

Effects of BNPL on Your Credit

Most of the companies that acquire buy-now-pay –later accepts soft credit check for approval and doesn’t even affect your credit score. Sometimes others may conduct a hard pull for credit files.

It is very important to pay monthly installments after agreeing on the BNPL loan. If you don’t pay your installments on time, it affects your credit score or even your credit report.

If your reports of credits are negative, next time you find it difficult to buy products online on credit.

Some Pros of Buy Now, Pay Later

  • Easy way to pay on the purchases
  • No interest or sometimes low interest
  • A credit score is not necessary
  • Fast approval

What is the Interest Rate of a BNPL Loan ?

Most of the plans charge 0% interest rates, as long as you are making your payments timely, if you are not making payments properly the interest rate can be high up to 36%. So before taking any action, take proper knowledge of the service.


In short, Buy-now-Pay-later makes it easier for customers to buy things online even if they have no full amount. By giving a small amount, the product can be of users. They don’t even need to pay interest on their remaining payment of installments.