KUALA LUMPUR – A recent study has predicted that Buy Now Pay Later (BNPL) will exceed over 900 million users worldwide by the year 2027.
Juniper Research’s study revealed that there are 360 million BNPL users worldwide in 2022, and expects the number to grow 157% to 900 million in a span of five years.
According to the research company in a recent statement, the growth is likely to be driven by the projected economic slump which will raise the demand for low-cost credit solutions.
The BNPL schemes would offer customers the ability to pay for their purchases over a period of time without incurring interest charges, which makes them an extremely attractive alternative to credit cards.
In addition to that, BNPL services also does not call for hard credit checks to be performed, while a growing number of retailers are also accepting this payment method. This makes it easier for consumers to access compared to traditional credit.
Juniper Research also identified India possessing the potential for rapid expansion for BNPL, with the number of users anticipated to increase from 25 million this year to 116 million in 2027. This is because of the rise in eCommerce usage and the growing interest in international groups that are made available through online merchants.
Furthermore, the research also predicts that the adoption for virtual cards, in which digital only cards are used for purchases, would enhance the usage of BNPL solutions. This is because the solutions would only require merchants to accept card payments and overcome the previous restraints for growth.
The development of virtual cards has made it possible for BNPL schemes, particularly those that are used in-store, to compete with credit card systems as virtual cards would enable single-use BNPL cards to be used within a digital wallet for contactless transactions.
Juniper Research recommends that BNPL suppliers distinguish their services in order to succeed in this highly competitive landscape. These services should include the provision of virtual cards, browser extensions that automatically support BNPL payment services, and digital loyalty programmes.
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