Why Europe Must End Its 30-Year Digital Winter to Ensure Its Long-Run Future

Zilch Unveils BNPL Plan for ‘Significant Purchases’


British buy now, pay later (BNPL) firm Zilch has launched a new credit payment product.

The company says its Pay over 3 months” product, announced Thursday (Sept. 22), does what its name implies, letting customers stretch interest-free repayments for larger purchases over three months. 

“Today’s product launch moves Zilch closer to our end game of capturing total share of wallet,” said Philip Belamant, Zilch’s co-founder and CEO. “This new payment option is tailored for significant purchases or emergency moments, such as buying electronics, car tyres or home repairs like when the boiler breaks.”

According to a company news release, the new offering has already been tested with around 100,000 Zilch customers. The company plans to roll it out to 3.6 million additional users beginning in April.

When using the Pay over 3 months options, customers will put up 25% of the cost and spread the remaining purchase price over three installments. Zilch said this offering represents one of the “longest-duration loans provided by any major UK fintech offering zero-interest regulated credit payments.”

Zilch’s offering comes at a time when BNPL options are in demand among customers across all levels of income, and being used for transactions large and small, trends reflected in both PYMNTS Intelligence data and research by the Federal Reserve Bank of New York. 

“[A]cross levels of financial stability, it is rare for people to use BNPL just once,” the Fed said a blog post last week. “Indeed, about 72% of financially stable users and 89% of financially fragile users have made multiple BNPL purchases over the past 12 months.” 

The Fed defined “financially fragile” consumers as people who have credit scores under 620 and the rest as “financially stable.” Roughly 60% of financially fragile consumers use the installment options as many as five times per year. Drilling down somewhat, the Fed found that 23% of financially stable consumers use BNPL with the same frequency.

Meanwhile, PYMNTS Intelligence found that roughly a third of consumers living paycheck to paycheck (whether or not they had issues paying their monthly bills) are frequent BNPL users, and at least 25% to 29% of households who make up up to $100,000 per year either had used, or are using, BNPL.

In terms of large-ticket items, the Fed data shows that about 17% of financially stable BNPL users divided transactions across several payments for goods and services averaging between $1,750 and $2,000. And PYMNTS Intelligence found that higher income cosumers are becoming among the heaviest BNPL users, with purchases above the $2,000 level, particularly for electronics and home furnishings.