PayPal has released an update designed to make its Buy Now Pay Later (BNPL) offer a more attractive offering amid fierce market competition.
The payment giant has announced that it is expanding its service with a new monthly payment plan, which will allow US-based customers to spread payments over periods of up to 24 months.
The service is available for purchases between €199 and €10,000, with interest rates ranging from 0% to 29.99% APR depending on the term of the payment plan.
The battle for the BNPL
The BNPL market was thrust into the spotlight earlier this month when Apple announced plans to enter the space with its Pay Later program, which will allow customers to split any payment made through Apple Pay into four installments. .
Given the size of Apple's install base and the ubiquity of online payment systems and Apple Pay-enabled point-of-sale terminals, the company looks poised to grab a big chunk of it. del mercado.
Faced with competition from Apple, PayPal decided to differentiate its service with much longer payment plans. Apple requires users to repay BNPL loans (up to €1,000) within six weeks, while PayPal now offers a two-year trail and supports much more expensive purchases.
However, there are concerns in some quarters about BNPL's long-term impact on personal finances, particularly those of younger and less tax-savvy buyers. The concern is that the wide availability of BNPL will attract frivolous buyers that buyers can't afford, trapping them in a spiral of interest payments and killing their credit rating.
However, PayPal sees the situation differently, choosing instead to emphasize the flexibility that BNPL offers buyers in the face of severe inflation and sharply rising utility costs.
"As the macro environment continues to evolve, consumers are looking for ways to stretch their finances and gain better control over their purchases," said Apur Shah, who heads BNPL at PayPal.
“There is no one-size-fits-all solution when it comes to shopping, and the same goes for the buy now, pay later industry. We believe that having a full portfolio of BNPL plans, in addition to our PayPal Credit revolving credit product, gives consumers more options to select the option that best suits their preferences and budget needs.
Via ZDNet (Opens in a new tab)