Given a pandemic, it comes as no surprise that consumers are actively looking for the best ways to manage their finances and pay fewer fees.
According to a recent survey by PayPal, findings revealed that 57 percent of Gen Z and Millennials say they think using purchases now, pay later solutions are a “smarter way to shop”, while 37 percent say it gives them more control over their finances and 33 percent state that no late fees are an important feature when choosing a BNPL option.
With these consumer sentiments in mind, PayPal has announced that from October 1, 2021, new customers will waive any fees for late or forgotten payments for purchases made through PayPal’s package of BNPL products – including Pay in 4 in the US, Pay in 3 in United Kingdom and Pay in 4X in France. PayPal’s BNPL solutions in Germany and Australia are already free of charge.
“Based on the success of our Pay in 4 launch in Australia with no late fees, we know that eliminating late fees provides an even better buy now, pay later experience that gives our customers and trading partners incredible value,” said Greg Lisiewski , Vice President of Global Pay Later Products at PayPal.
In the end, he said the move would give consumers even more security in their choice to use PayPal’s global BNPL products. “We can help give consumers peace of mind when managing their plans on their terms, while also helping merchants increase sales conversion,” Lisiewski said. “This change is closely linked to PayPal’s mission and values as we seek to remove barriers to providing financial services to customers of all types while helping our trading partners succeed in the changing retail landscape.”
Although consumers value BNPL for the economic flexibility it provides them, it is important to note that merchants also see the benefits of the increase in consumer demand for BNPL. According to PayPal, retailers offering Pay in 4 from PayPal benefit from 50 percent Pay in 4 repeat use within three months of their first purchase and 70 percent within six months and see conversion rates increase with cart sizes increasing by as much as 39 percent .
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