The increasing popularity of Buy Now, Pay Later (BNPL) online purchases is growing at a rate of 39% a year according to Finder (2020), with market share set to double by 2023. Nearly 9.5 million Brits said that they avoided buying from retailers that don’t offer BNPL options at the checkout. This popularity looks set to continue, with 8.6 million Brits (13%) planning to use BNPL services more in the future. The number of UK brands offering BNPL options is also increasing, making it a viable way to pay for a lot of goods. For example, Klarna saw a 20% increase in UK brands using its service during April 2020. This is understandable, as BNPL options benefit retailers by increasing customer loyalty and basket conversions and boosting sales by up to 30%.
Here are some of the main players on the BNPL market:
⚡ PayPal – a global payments processing company covering pretty much every step within e-commerce, however has 20-year-old tech that is trying to be as nimble as a 1-year-old tech stack. PayPal actively works around QR payments, despite does not have QR lending options yet (yes, like JO1N J).
⚡ Deko – is a UK based innovative software company multi-product and multi-bank retail finance platform with award-winning technology. Deko predominantly focuses on interest-bearing products and redirect customers to other lenders on their back-end, hence obtaining a consumer credit licence might be required for the merchant.
⚡ Klarna – is a Swedish payment service provider that takes end-to-end responsibility for merchant payments. Klarna is the provider of smooth payments to more than 200,000 predominantly online stores. Over 85 million consumers worldwide have trusted Klarna to securely handle their payments. Alternatively, buyers can pay in 30 days. Try stuff on at home and decide which items they want to keep; you then have 30 days to pay. No upfront payments at checkout, no interest, and no fees (if paid on time). You can either choose to split your payment into three instalments which are collected every 30 days, with no interest or fees (if paid on time).
⚡ DivideBuy – UK based BNPL company with marketplace proposition. Does not provide customer identification, nor post-purchase experience. Unfortunately, customers can’t identify themselves with DivideBuy login across websites, which makes it a standalone checkout solution.
⚡ ClearPay – UK based global BNPL company focusing exclusively on online lending. Offline lending is not covered as well as identification tools. ClearPay does not charge a fee to shoppers when purchasing. ClearPay only charges fees to the merchants. The only fees applied to a shopper’s account are late fees if your scheduled payments are unsuccessfully processed. With ClearPay customer pays 25 % of the purchase at checkout. The rest is split into 4 equal instalments that have to be paid for their online services, only.
⚡ Zip Co – Australian BNPL company currently joining UK space. Zip is an example of a perfect, important and very interesting competitor actively investing in BNPL/checkout related ventures. The recent acquisition of Quadpay expresses the importance of vertical integration. Both sales channels are covered (online & offline), however, the company is not active in the customer identification and checkout field.
⚡ Zilch – OTP BNPL company. Wait, stop, what does OTP stand for? Zilch is a virtual over the top consumer credit card that allows you to buy now, pay later at thousands of retailers including Amazon, eBay, Ali Express and Nike. Sooo… you know those goodies on your wish list that you were patiently waiting until payday to buy? Zilch can help speed that along. The interest-free payment service allows you to buy products when you want them while spreading the cost of these items over four instalments in six weeks. Unfortunately, the company does not focus on offline distribution channel, moreover due to partnership with MasterCard, unlike partnering with merchants directly, not has offline proposition.
So, how is JO1N different and why is unique?
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