{"id":69,"date":"2023-11-06T21:48:37","date_gmt":"2023-11-06T21:48:37","guid":{"rendered":"https:\/\/wegetfinancing.com\/blog\/?p=69"},"modified":"2025-11-26T21:00:17","modified_gmt":"2025-11-26T21:00:17","slug":"what-is-bnpl-why-should-merchants-care-about-it","status":"publish","type":"post","link":"https:\/\/wegetfinancing.com\/blog\/what-is-bnpl-why-should-merchants-care-about-it\/","title":{"rendered":"What is BNPL & Why Should Merchants Care About It?"},"content":{"rendered":"\n

In the last three years, BNPL has become the term used to describe anything falling under the consumer financing umbrella. In the U.S. market, both in-store and ecommerce Buy Now Pay Later options have become essential payment alternatives. With sales and average order value (AOV) growth of 30-40%, the question isn\u2019t whether to offer BNPL, but which provider will best meet your consumers’ needs. <\/p>\n\n\n\n

As merchants and ecommerce businesses try to leverage the varied BNPL options available to their consumers, it is important that they understand that Buy Now Pay Later is far more than a split pay option<\/strong>. BNPL is a necessity that will help online stores maintain and expand their customer base in the coming year.<\/p>\n\n\n\n

The Modern-day Shopper & Buy Now Pay Later<\/strong> options<\/h2>\n\n\n\n

In 2000, PayPal Credit, formerly BillMeLater, sparked the online point-of-sale economy. If a merchant decided to accept PayPal Credit, then this gave online shoppers another way to pay. Today, the modern-day consumer is now met with a medley of BNPL solutions at the checkout<\/strong>.<\/p>\n\n\n\n

Just as its name suggest, Buy Now Pay Later lenders allow consumers to apply for financing, and pay for the item in equal installments<\/strong>. According to the Consumer Finance Protection Bureau, the BNPL industry saw high-speed growth during the Covid-19 Pandemic. From 2019 to 2021, \u201cBNPL loans grew by 970%, from 16.8 to 180 million, while the dollar volume of these originations (commonly referred to as Gross Merchandise Volume or GMV) grew by 1,092%, from $2 billion to 24.2 billion.\u201d <\/p>\n\n\n\n

Most retail businesses, especially e-tailers, recognize the importance of presenting their consumers with this type of financing option. They know that BNPL is here to stay, but the companies who invest in BNPL payment technologies will be the ones that thrive.<\/strong><\/em><\/p>\n\n\n\n

The Problem with Too Many BNPL Options<\/h2>\n\n\n
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If five people were asked to describe their credit persona, none of them would have the same answer. Yet time and time again, merchants tend to treat their consumers like they are in the same financial position<\/strong>. If a consumer were to hop onto an online store selling electric bikes or PC gaming computers, they might see popular options, like Affirm, Klarna or Bread. However, one lender cannot underwrite every customer<\/strong>. For optimized business growth from consumer financing in the US<\/a>, a good BNPL technology should be customer-centric and able to offer tailor-made financing options.<\/p>\n\n\n\n

Presenting multiple lenders at the checkout poses challenges as well. The average consumer does not know the difference between one BNPL option from another. And many consumers have different BNPL needs and preferences. For instance, millennial and Gen Z consumers have different buying behaviors than Gen X and Baby Boomers. <\/p>\n\n\n\n

Per PYMTS.com <\/a>(1), Boomers are less likely to use BNPL options, whereas GenZ is the most likely. Gen Z likes BNPL, because their credit limits are lower. Younger generations may only have one credit card, which is why BNPL is attractive to them (see also The Rise & Benefits of Consumer Financing for Online Shopping<\/a>).<\/p>\n\n\n\n

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The Right Payment Technology Matters<\/h2>\n\n\n\n
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“…, one lender cannot underwrite every customer<\/strong>.”<\/p>\n<\/blockquote>\n\n\n\n

Merchants with more than two financing options at the checkout are more likely to lose a customer to cart abandonment<\/a>. More applications mean more keystrokes, which can lead to confusion and eventually, the customer leaving the webstore altogether. According to PYMNTS.com, 73% of customers will never return to a webstore if they had a poor checkout experience.<\/p>\n\n\n\n

Investing in the right payment technology can help merchants manage their need for multiple BNPL options, while also maintaining a high-quality checkout experience<\/strong> for their customer. GenZ and Millennial consumers want an easy & fast checkout with multiple options presented to them. Multiple lender platforms, like WeGetFinancing, allow customers to see multiple Buy Now Pay Later options, side by side, for which they are already approved<\/strong>.<\/em><\/p>\n\n\n\n

For merchants operating online, one of the best ways to reduce this friction is to rely on ecommerce platforms that support native financing integrations. Our BNPL on commerce platforms guide<\/a> explains how Shopify, WooCommerce, and other ecosystems handle embedded lending.<\/p>\n\n\n\n

H<\/strong>ow Multi-lender Platforms Are The Future of BNPL<\/strong><\/h2>\n\n\n\n
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