New Report Shows Shoppers Spend More with Marchants Offering Buy Now Pay Later
SA’s online shoppers clearly prefer to buy now pay later (BNPL) and mostly choose it over standard payment or credit options. BNPL leader in South Africa Payflex found that over 80% of customers surveyed spend more at an online store if BNPL is offered. More than 90% shop more frequently at an online store with Payflex available and almost 80% would not have made their most recent online purchase if not for the BNPL offering.
This is according to Payflex research conducted among more than 600 customers that have used the fintech’s service more than once.
Paul Behrmann, Payflex CEO, says that in the past year, purchase values for BNPL have been 30%-50% higher than for purchases paid in full up-front or on credit. Merchants still receive payment within 24 hours whether the customer chooses a Payflex buy now option or a BNPL option.
”Shoppers definitely prefer to pay off their purchases in staggered interest-free instalments when given the choice. The volumes reported by SA merchants mirror the global trends, which is driving a massive rise in the number of merchants offering BNPL. Sales for online stores achieve increases of up to 30% on average order values with the introduction of Payflex as a payment option, but there are improvements in other key business metrics like revenue and new customer acquisition,” he says.
The BNPL service allows qualifying customers to split the cost of their purchases into four equal instalments, interest-free. The process is simple and quick for customers – the assessment is done in seconds and customers only pay a fee if they miss a scheduled instalment. Payflex accepts any Visa, Mastercard or American Express cards (debit, credit or cheque).
“BNPL has not only changed how consumers pay, but how much they buy, how often they buy and where they shop,” says Behrmann.
Payment plans in the retail sector are not new. However, non-interest bearing options like lay-by mean that the store holds the product until it is paid in full. BNPL consumers receive their orders immediately after paying just 25% of the cost.
Customers tend to be younger (25-34) and are attracted to the zero interest rates as well as transparent payment plans and conditions. “Instalment payment options allow customers to stick to a budget, avoid debt, and increase their purchasing power,” says Behrmann.
Payflex grew from a shopper base of 2 000 to 100 000 in 12 months and its customer base soared from 70 merchants in 2019 to over 800 active stores this year.
The survey also revealed that Payflex customers are extremely likely to recommend the service to others. Payflex received a Net Promoter Score (NPS) of 82, which is extremely high given that a score above 50 is considered excellent by the source of the NPS system, Bain & Co.
Bola Tinubu: 7 Signs on the Street that’ll Judge Him as President
President-Elect, Bola Tinubu will be sworn in as Nigeria’s 17th President on May 29, 2023.…