62% Of Customers Are Ready For BNPL*

Buy Now, Pay Later (BNPL) solutions have become table stakes for today’s savvy consumers who want affordability, transparency and convenience when making purchasing and financing decisions on big-ticket items.

According to the Citizens Point of Sale Survey, 62% of consumers prefer fixed monthly plans with clear payment terms. When payment plans are backed by a simple and seamless transaction experience, 76% of consumers say they are more likely to make a purchase.

For retailers, BNPL can help widen the customer funnel while driving repeat purchases and increasing average order value (AOV). Transaction volumes in the BNPL sector are set to jump by 92%, from $353 billion in 2019 to $680 billion by 2025.

BNPL offers the opportunity to boost bottom lines and gain a competitive advantage. However, not all BNPL solutions are created equal. Gaining an edge depends on having a strategic focus and carefully assessing your options to make sure your offering meets your customers’ needs and aligns with your business capabilities.

Affordability may be the biggest draw for BNPL users, but it’s important for merchants to lead with a BNPL solution that really meets the needs of their target customers. Knowing the highest impact target demographic to market to – and creating a purchasing experience that satisfies the targets’ expectations — will make the difference in bringing in net new customers.

The primary areas where customers are seeking a smoother transaction experience include:

• Speed. Once in the funnel, digital-first consumers are looking to check out as quickly and smoothly as possible. Convenience is a top priority for BNPL shoppers and adding more steps to the funnel can easily lead to missed conversions and abandoned carts. While most BNPL products promote easy checkouts and applications, there may be big differences in speed and simplicity that can impact the point of sale (POS) experience.
• Higher limits. Different cart sizes attract different demographics and ultimately that cart size can affect a customer’s decision to purchase. Not all financing companies can handle financing larger amounts so it’s good to do the research and verify the limits align with your customers’ preferences.
• Clear terms. Transparency and trust are crucial for creating impactful purchasing experiences. A business’s BNPL solution should match its brand's values and meet customer expectations for clarity and openness. Customers favor BNPL, in part, because it clearly lays out how they are going to pay off a purchase. But if a provider isn't up-front about terms and conditions (e.g., late payment fees), it adversely reflects on your brand and sales.
• Reputation. Customers steer toward brands and businesses they know and trust. That comes into play when choosing to make and finance a larger purchase via BNPL. The customer might not be looking for licensing and compliance details, but there is a risk that customers won’t use a financial product they aren’t familiar with.

Merchants must also think about how a BNPL product is going to align internally and meet their business goals and requirements.

One of the critical factors is the expense and how much a new payment method is going to cost to set up as well as service the financing. BNPL companies that rent bank charters pass those costs along. However, BNPL’s that operate with a bank charter don’t need to outsource the financing, and in turn pass those savings on to merchants.

Ease of implementation is another consideration. Just like the customer experience, the process should be quick and easy for the tech team. Generally, it should be a matter of simply adding some code on the back-end, but it’s important to verify timelines, what's involved and who's responsible for what.

Depending on a business's size and the complexity of its offerings, customization is an important area that requires analysis and review. One-size-fits-all solutions are readily available but might not fit the requirements of larger retailers with many diverse needs. And it may not help to differentiate your customer experience from the competition's. Considering a BNPL with the capability for an upgrade program (think new phone, laptop, or new gaming console, for example) might be the best solution, verses a one-size-fits-all approach.

Partnering with Apple®, Citizens Pay launched one of the first modern BNPL programs, making it easier and more enticing for consumers to buy an iPhone®. The program paved the way for rethinking how consumers finance large purchases.

Built on extensive experience in consumer financing, Citizens Pay was designed with both the consumer and merchant in mind. It’s a strategic approach centered on strong partnerships and helping retailers develop unique BNPL for their businesses. For Citizens Pay partners, that means the ability to fully customize the solution to their unique needs and offer a product that seamlessly integrates into any online or in-store POS experience.

Citizens Pay also comes with the backing and reputation of an established bank, and its ability to finance and service customers confidently and cost-effectively.

To learn more about how BNPL can help increase sales and upgrade your business, check out the Citizens Pay online resources and complete the inquiry form to request to talk with a Citizens Pay professional.