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THE Buy Now Pay Later (BNPL) credit product has been growing in popularity globally, prompting IOUpay to launch its own version of the service, myIOU, on June 15, 2021.

IOUpay is a financial technology and digital commerce company offering a range of mobile banking and transaction services such as customer identification and authentication, one-time password, account balance enquiry and payment transfer confirmations.

Its CEO Khong Kok Loong said the BNPL service allows consumers to buy something without having to make a full payment until a later date, thus spreading out payments.

“MyIOU gives consumers a more transparent, budget-friendly, and responsible way to pay for large-ticket items. Consumers can split their purchases into two, three, or six-monthly payments upon check-out with absolutely 0% interest,” he said to The Malaysian Reserve in an email recently.

According to Khong, flexibility and smart spending are the key motivations behind myIOU service. “By allowing consumers to pay for goods and services in instalments over an agreed period, we are giving consumers who may be under financial pressure the opportunity to gain access to their necessities and needs while spending responsibly,” he noted.

He added that myIOU Credit+ provides an instant credit approval from RM1,000 to RM10,000 and consumers can choose to pay with a credit or debit card.

“There are currently more than 300 online and in-store merchants on myIOU. Some of the prominent merchants are Aone Plus, Buffalo Malaysia, Livein, Loop on Leith

Hotel, smartrental.asia, Teppanyaki Malaysia and Tsukiji No 18,” he stated.

He added that IOUpay also established strategic partnerships with leading industry players namely EasyStore, GoBiz, MYP1, and Razer Merchant Services, building a potential market base of over 75,000 merchants to be enabled with myIOU.

Khong added that myIOU was designed to accommodate the ever-growing cashless market in Malaysia and South-East Asia by offering both retail and e-commerce merchants flexible payment options for in-store and online consumers.

“It can help merchants increase sales conversion and reduce abandoned cart rates, as consumers have an option to pay online or in-store. Then IOUpay pays merchants in full-upfront with a standard weekly settlement cycle,” he said.

Despite some of the key misconceptions in BNPL, the need for alternative financing solutions among underbanked and unbanked communities continue to grow, he explained.

“Unbanked individuals looking for options to gain access to non-ravening lending solutions and average consumers looking for ways to do more responsible purchasing can derive value from BNPL. Going forward, both BNPL providers as well as partnering financial institutions must focus efforts on financial literacy to help develop responsible spending habits among the consumers,” he said.

Khong opined there is plenty of potential for this service to grow particularly in a region like South-East Asia.

“The region is a sweet spot for BNPL for three simple reasons such as high smartphone and Internet penetration, a fast-growing cashless movement and a credit-starved market with a huge underbanked and unbanked population.

Based on Malaysia Central Bank data, total transaction for retail and e-commerce in Malaysia alone is RM1.4 trillion. Putting BNPL adoption at 10% translates to RM140 billion and we believe it could be more,” he said.

He said with its strategic partnerships, IOUpay has a really strong pipeline to activate and execute myIOU BNPL service and are also on track with its plans to expand to two new South-East Asia markets later this year.

“We are already seeing many exciting growth opportunities, particularly in the business-to-business segment. This is in a wide range of sectors including corporate and SMEs purchases, employee healthcare and insurance and inventory financing,” Khong noted.