Buy Now, Pay Later (BNPL): Transforming Sales Through Affordability Solutions

In today’s business landscape, many enterprises are actively pursuing strategies to enhance sales performance through affordability solutions. Buy Now, Pay Later (BNPL) has emerged as a prominent option, providing interest-free credit, commission-free transactions, and flexible payment options for customers. By facilitating fast and seamless transactions and empowering consumers with increased purchasing power, BNPL not only meets the evolving demands of modern shoppers but also drives significant increases in sales volumes for businesses.

What is BNPL?

Buy now, pay later (BNPL) is a type of financing that allows consumers to make purchases and pay for them over time. It enables customers to spend beyond their monthly budget without having to pay the full price upfront in cash, debit, or credit card. By doing so, customers can finance their purchases immediately and repay them in fixed installments over time.

Merchants receive the full payment of the item in advance without having to manage the financing, depending on the deals between merchants and providers. They witness the growth of their sales due to the ease of payment provided by BNPL. BNPL providers handle underwriting customers, managing installments, and collecting payments, so the additional interest and fees directly go to these firms. This win-win situation not only provides ease of payment to consumers but also increases sales figures by activating the market.

How does it work?

BNPL services are typically offered as an option during the checkout process, alongside credit cards and other payment methods. When making a purchase, customers select a BNPL provider in the payment form and are then directed to the provider’s website or app to create an account or log in. Upon completion of the purchase, businesses receive the full payment upfront, though some agreements may extend the payment terms. Customers then pay their installments directly to the BNPL provider, which may include interest and fees.

Customers favor BNPL as a payment method for various reasons: the ability to make instant payments in-store without the need for a credit card or cash, quick and secure account setup, seamless and secure installment payments, and its applicability across diverse industries.

BNPL Solutions at Innovance

At Innovance, with our industry experience proven in more than 200 projects and our team of experts, we are here to support you with BNPL solutions. Innovance serves as a solution partner, offering an end-to-end BNPL solution that covers all processes, from customer onboarding to loan payments. Additionally, Innovance provides fast integration and setup processes, led by an expert team capable of handling custom requirements.

Key Features

· Customer Onboarding: The Innovance BNPL solution offers a seamless and rapid customer onboarding experience across both online and offline channels. Integration with any KYC provider requires minimal development effort, ensuring smooth implementation.

· Limit Inquiry: Our solution provides a limited inquiry option accessible via both SMS and API channels, catering to all individuals, including potential customers not yet onboarded and existing customers. This feature has the potential to enhance marketing activities by encouraging customers to make use of their limits.

· Loan Application: Applying for a loan is easier than ever with Innovance. After completing the membership, the customer only needs to choose the payment plan and confirm the contracts. It’s that simple! Thanks to our efficient design and low-latency credit scoring system integration, existing customers can complete the loan application process in under 30 seconds.

· Merchant Solutions: Innovance facilitates merchant agreements with the help of various technologies. With the assistance of API infrastructure, e-commerce platforms are integrated safely and easily, allowing merchants to complete their payments without leaving the integrated application if desired. The Dealer Panel enables contracted stores to make loan applications offline within a minute. QR codes allow customers to complete their purchases and leave the store in seconds. The merchant partner integration system is designed for customers to apply for loans from the comfort of their homes.

· Payments: The Innovance BNPL solution offers customers many options to pay their installments. Customers can pay their installments as they wish with digital wallet, credit/debit card, and wire transaction options.

· Back Office: Our backoffice system offers comprehensive control and flexibility, ensuring compliance with various local regulations and standards in international markets. Key features include:

Ø Parameter Management: Easily manage variables to comply with different international standards.

Ø Merchant Onboarding: Complete the entire onboarding process on a single screen, including configurations for merchant details, payment options, installment plans, campaigns, and rates.

Ø Customer and Loan Operations: Observe, execute, or approve operations such as early closures, interim payments, refunds, and restructurings with appropriate roles and permissions, following maker-checker rules and legal requirements.

Ø Payment Management: Monitor, modify, or refund credit card, wire, and wallet payments based on user roles and permissions.

Ø Interest and Fees Customization: Define and adjust interests, fees, and commissions on a store-by-store basis.

Ø Customer Agreements: Draft, change, and terminate customer agreements via back-office screens.

Ø Seamless Integration: Minimal development effort required for integration with accounting and decision support systems.

By streamlining these processes, Innovance ensures efficient and flexible backoffice management tailored to diverse business needs.

Additional Advantages

· Secure: Undergoing penetration testing, our solution demonstrates a robust security infrastructure, instilling confidence in customers regarding the safety of their transactions and data. This assures users that their information is secure and ensures uninterrupted service for the users. Additionally, regular penetration tests are conducted to consistently evaluate and strengthen the system’s defenses against evolving cyber threats.

· Scalable: Utilizing microservice architecture and Kubernetes technology, Innovance BNPL solution is fortified and advanced. Highlighting the scalability of our product, one of our current customers has increased their loan count from 10,000 to 150,000 within just one year. Thanks to the scalability of our product, our customers have enjoyed uninterrupted service without any disruptions.

· Flexible: Our product boasts flexibility in multiple aspects. Installment options such as moratoriums, early closing, and deferred installments are available parametrically, allowing users to customize them to their specific needs. Additionally, campaigns come with varying merchant commissions, interest rates, and installment numbers, providing users with the flexibility to tailor promotions according to their business objectives.

· Usable: Emphasizing usability, our BNPL solution features a user-friendly interface meticulously designed by UX experts, guaranteeing intuitive navigation and interaction. Additionally, our web applications are mobile-responsive, seamlessly adapting to various screen sizes and devices, providing users with convenient access and usability across platforms. These features underscore our commitment to delivering a seamless and user-centric experience, ultimately enhancing customer satisfaction and engagement.

· Customizable: Innovance BNPL solution provides a white-label version, allowing customization with the brand logo to create a personalized touch. Language support is ensured through localization for any language, enhancing accessibility. Its modular design enables seamless integration with potential additional features. Various user roles, including the ability to generate new roles, are supported, each with distinct permissions and allowances, ensuring tailored access and control for different team members.

Why Choose Innovance?

Innovance emerges as the premier partner for enterprises seeking to revolutionize their sales strategies through innovative affordability solutions such as BNPL. With a dedication to excellence, Innovance delivers seamless customer onboarding experiences, expedited integration processes, and a skilled team of experts ready to address unique needs.

Authors: Ceren Eryılmaz & Ekinsel Akca