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Buy now, pay later provider Splitit Payments Ltd. has launched an installment-payment option for financial institutions that consumers can access at the point-of-sale.
Financial institutions can offer the option by connecting directly to Splitit’s merchant networks, through a direct link or through a card network.
The payment option, called FI-PayLater, enables financial institutions to vie for BNPL transactions at the point-of-sale, as opposed to offering a post-purchase installment plan through their credit cards. Hence, the service gives financial institutions a way to connect with their customers during the so-called “in-checkout” moment, a space now largely dominated by BNPL fintechs, Splitit says.
Splitit says it developed the service based on feedback from financial institutions.
“Although some FIs have their own BNPL solutions, these are typically post-purchase, which lacks the influence on buying decisions that in-checkout options offer,” a Splitit spokesperson says by email. “FI-PayLater addresses this by providing a unified platform that includes network installment programs such as Visa’s and MasterCard Installments, streamlining the process for merchants and enhancing their checkout experience.”
While opting for post-purchase installment plans on a credit card is a logical alternative for consumers who prefer to purchase with credit cards, most consumers are not readily aware of that option, also known as a flexpay option, which is a drawback for financial institutions offering those plans.
Some 44% of credit card holders in the United States said they have a flexpay plan available to them, but just 12% have used the service, according to Datos Insights.
“Most issuers offer their flexpay options after the purchase and consumers have to be proactive in finding them,” Ariana-Michele Moore, advisor, Retail Banking and Payments for Datos Insights, says by email. “Splitit’s model pushes the offer to consumers at the point of purchase.”
Key features of FI-PayLater include one-click installment selection at checkout with customizable preferences for plan duration and embedded network installment programs, including Visa and MasterCard Installments. Financial institutions also have the option to pre-fund the merchant and collect the installments from the shopper or have Splitit manage those tasks.
In addition, merchants offering the service can access a merchant portal that includes reporting, exception management, and parameter setting across all participating financial institutions. Financial institutions can access a portal that includes reporting, transaction research, and installment-plan configuration options.
“Splitit’s FI-PayLater simplifies the integration process for merchants by offering a single point of integration that enables them to accept installment payments from multiple banks and networks. This streamlined approach not only reduces the complexity of integration, but also makes operations easier to manage,” the Splitit spokesperson says.
In related news, Klarna AB has announced an agreement with Uber to provide alternative payment methods on Uber’s platforms, which include ridesharing and Uber Eats. The service allows consumers to pay for their ride in full with one click.
The service is available in the U.S., Germany, and Sweden. Consumers in Sweden and Germany have access to a monthly payment plan that aligns with their salary cycles, offering a budget-friendly, interest-free option to manage expenses without additional fees.
The service is expected to offer consumers more convenience and control over their payments, Klarna chief executive and co-founder Sebastian Siemiatkowski says in a statement. Siemiatkowski adds that Pay Now transactions represent a significant portion of Klarna’s global transactions.
