Great to see SplitIt coming into a reporters radar when writing up BNPL articles across what they call key "Klarna, Affirm, Splitit and Afterpay" providers. Good find HeyLine
Marrying BNPL with Credit Cards
New data from BNPL provider Splititindicatesthat 60% of consumers would prefer to use BNPL within their existing credit cards instead of opening new lines of credit. The survey also found that 83% of respondents felt that credit card perks — including cash back, points and miles — are important, and 48% said these bonuses are the greatest reason for their use of credit cards. The survey also showed that 83% of consumers are happy with their credit cards and 71% view the cards as part of a balanced approach to personal finances. Sixty-nine percent of respondents said they would use their cards more often if the interest rate were lower, and 63% would do so if they could pay in smaller, interest-free installments.
While some consumers are specifically interested in BNPL because they lack access to traditional credit, shoppers who have credit are still interested in BNPL as a payment option for purchases beyond a certain cost threshold. PYMNTS found that 43% of worry-free consumers are interested in using BNPL to pay for higher-priced, one-time retail purchases.
One way to gain the best of both worlds of credit cards and BNPL could be through a flexible orchestration layerenablingconsumers to leverage balances on their existing credit cards to pay in installments without new financing or additional interest or fees. Because it is network-agnostic, merchants can offer installment payments for most major credit cards. Consumers with the available balances on their credit cards are automatically prequalified, and they would be able to take advantage of their cards’ rewards programs. There are no application fees or changes to their credit reports, creating minimal consumer friction. However, such an approach can be successful only with broad merchant adoption and ubiquity across all cards and networks.
BNPL appeals to consumers by allowing them to budget better, but loyalty programs are one of the greatest purchasing incentives. Recent PYMNTS data shows that 64% of consumers say store cards provide better rewards compared to 57% who report BNPL doing so. Integrating BNPL installments into credit card offerings with rewards programs provides a unique opportunity to drive cardholder loyalty and usage at the point of sale.
