Today’s present era is modern. People want to improve their standard of living. But for some people it becomes difficult due to children’s school fees, health expenses or a reduced salary, Buy Now Pay Later (BNPL) gives people the opportunity to buy the product they need and want and pay at a future date. BNPL is a kind of short term financing where consumers typically pay for a short term of 60-90 days. BNPL is a modern change from credit cards, generally offering interest-free benefits, no long forms to fill out, and generally less “fine print”. The main companies in 2021 offering these services are:
Affirm was established in 2012 and operates as a financial lender, provides loan facilities to small clients and they have to repay the loan with interest free installments. In 2012-2016, Affirm provided short-term loans to consumers to purchase the product they needed, and in 2017, it launched an online shopping app for purchasing retail products. Affirm launched its app with the vision, “When you buy with Affirm, you always know exactly what you’ll owe and when you’re done paying.” There are no hidden fees, not even late fees ”. Affirm provides three payment schedules to customers: three weeks, six weeks and twelve months. Consumers should choose according to their convenience.
Klarna was founded 15 years ago in Sweden and moved to Australia via CommBank. Klarna thinks she pays later and owns first. To purchase from Klarna, customers must log into their app and then create a “ghost map”. They can then select the amount they want to use. If this amount has been approved, the customer can use this card to purchase the products they want online. But all clients are advised to remember to check the terms and conditions for any fees before applying. The most common payment schedule is to pay 25% of the cost upon payment and the remaining balance over the 6 weeks. They also offer loan options of 6, 12, 18 and 36 months, with an APR.
Quadpay was founded in 2017; in their initial phase, they offered services to the US market. Quadpay offers point-of-sale loans to consumers. They buy their particular items from QuadPay partner retailers and consumers can split the cost into 4 interest-free installments. Quadpay also works with some of the biggest brands in the United States such as AOS, Apple, Forever 21, Lululemon, Nike, Walmart, Poshmark and many more partners. Quadpay earns money by taking fees from merchants. In the current era, there is a gap in this area therefore; new companies quickly entered this market to compete, including PayPal (with their Pay in 4 program) and SplitIt.
Sezzle was established in 2016 and works with this vision: “we believe that financial freedom can be achieved by everyone”. Sezzle, like QuadPay, allows consumers to split the cost of an online purchase into 4 interest-free installments, with the first payment due at checkout. They also generate their income by taking fees from the merchant. Sezzle offers customers a limit of $ 2,500, although not all are approved for that limit. There are many factors that go into approval, including identity verification, on-time payment history, and a smooth credit check performed upon payment.
Abunda is a United States-based e-commerce platform that allows the customer to buy now and pay later for Amazon products. Amazon is known to have millions of products and Abunda was created to access more of them. Customers can browse Abunda for the Amazon products they want, create a shopping cart, and choose a payment plan during checkout. If a product cannot be found, the Amazon product URL can be pasted into the search bar and Abunda will retrieve that product. Unlike other BNPL companies, Abunda does not offer its own financing; instead, they partner with other financiers so that people can select their already known and popular payment plan. Their current partners are Klarna, QuadPay, Shop Pay, PayPal, and ViaBill, all of which have different payment plans and benefits. Abunda is constantly expanding its list of financial partners and will soon be supporting other major retailers besides Amazon as well.