Installment Plans Help Acquirers Boost Reputation and Merchant Satisfaction

woman making payment

When a consumer is offered an installment or split-pay plan at the end of the checkout or any point of the shopping journey, the oft-assumed main benefit of doing so is for the consumer to have access to a purchase that they couldn’t afford otherwise (or simply to better manage their finances).

Alternatively, for merchants, the benefit may be to retain the customer, expedite the payment process or even boost sales. However, other players derive a benefit from offering installment plans: the acquirers who partner with merchants to offer these types of payments.

According to the PYMNTS Intelligence study “Acquirers’ Navigation of an Uncertain Installment Plan Landscape,” overall client satisfaction and reputation improvements represent the top benefits identified by acquirers across installment plan types. The study examined consumers’ use of installment plans for completing common purchases and the impacts on acquirers. The installment plans analyzed in the study include general-purpose credit cards, merchant or store card plans, and buy now, pay later (BNPL) plans.

The Data in Context

Half of acquirers who offer general-purpose card installment plans cited improved client satisfaction as one of the benefits. This was also the most common benefit cited by those offering merchant or store card installment plans, at 74%, and BNPL, at 63%. This higher inclination among the two latter installment plan types could be due to consumers’ desire to use general-purpose card installments during checkout.

Reputation improvement was also among the most cited benefits across installment plan types, especially for general-purpose credit cards, with almost half of acquirers citing it as the most important benefit.

Share of acquirers citing benefits from installment plansThe data for each installment plan showed a variety of other benefits. For example, BNPL plans stood out with a higher percentage (63%) of acquirers who support the plan experiencing the benefit of faster payment processing. In contrast, general-purpose credit card installment plans showed a lower percentage (46%) of supporters experiencing this benefit. Finally, 50% of supporters of general-purpose card installment plans recognized improved client satisfaction as a benefit.

The positive impact on customer experience and reputation confirms the role of these credit solutions in enhancing consumer satisfaction beyond payment process agility.