The new FI-PayLater allows financial institutions (FIs) to connect directly into Splitit’s card-linked installment platform or connect via their existing card network, the company said in a Wednesday (April 24) press release.
They can then gain incremental lending and fee income from buy now, pay later (BNPL) use cases, according to the release.
“By enabling FIs to present compelling installment offers to their customers at the merchant checkout, we enable FIs to become relevant within the ‘during purchase’ installment market,” Nandan Sheth, CEO at Splitit, said in the release.
“Additionally, giving issuers the ability to pre-fund the merchants and charge the shopper driving new fee income in the environment of regulated interchange,” Sheth added.
By offering their existing customers installment plans at checkout, financial institutions can enhance their brand presence, provide customers with more choices and strengthen customer loyalty, according to the release.
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In addition, merchants benefit by delivering payment options that are seamless and flexible, the release said.
“Our single entry point and extensive network of merchant endpoints make FI-PayLater the easiest and most effective pay-later option for issuers to adopt, integrate and operate across all consumer touchpoints, allowing us to lead the market and improve the economic model for all involved,” Collin Flotta, head of product at Splitit, said in the release.
PYMNTS Intelligence has found that 70% of consumers want to be able to access BNPL plans offered by banks rather than FinTechs.
Consumers who plan to use BNPL products also want to trust their credit provider, which is where banks may hold some advantage, according to “Banking on Buy Now, Pay Later: Installment Payments and FIs’ Untapped Opportunity,” a PYMNTS Intelligence and Amount collaboration.
Younger consumers — millennials and those buying homes and starting families — are among those most interested in installments, Sheth told PYMNTS’ Karen Webster in an interview posted in October.
“Their focus is changing from splitting a $200 hoodie to perhaps wanting installments for a new HVAC system in their home,” Sheth said.
