LazyPay Temporarily Halts BNPL Offering Because of Regulatory Concerns

LazyPay, the lending arm of PayU India, is halting its support of its buy now, pay later (BNPL) product LazyPlus UPI until regulators sort out questions about the platform’s issues among card-based FinTechs, according to an Economic Times report Tuesday (July 5).

LazyPay launched LazyPlus UPI in September 2020, giving users the ability to pay through the unified payments interface (UPI) channel from a revolving credit line issued to the customer, the report said. Until the temporary shutdown, LazyPay was issuing a credit line of up to Rs 1 lakh (about $1,263) to users for undertaking online and offline transactions through UPI.

“We miss you too! LazyPlus UPI will be back soon,” LazyPay wrote in a consumer communication reviewed by the ET. LazyPlus UPI stopped bringing on new users last year as banking partners pulled out of the arrangement, people aware of the discussion told Economic Times.

Last month, the Reserve Bank of India banned prepaid payment instruments (PPIs) from being loaded with credit lines. LazyPay updated its terms and conditions last week after the RBI directive, asking customers to accept new terms and conditions or have their transactions blocked.

The report noted that LazyPay is now looking to change the LazyCard from a prepaid card to a credit card and reissue them to the customers to comply with the RBI’s orders.

In April, LazyPay announced an extension of its service into the quick-commerce market through a partnership with Zepto, a 10-minute grocery delivery platform, giving customers the convenience of delaying payments for high-frequency purchases.

Related: BNPL Service LazyPay Partners With Quick-Delivery Grocery Platform Zepto

Meanwhile, LazyPay business head Anup Agrawal said the pandemic-driven popularity of eCommerce has led to a sizable change to business.

“However, as the situation normalizes, we are seeing continued growth trends and demands from customers, as evidenced by the quick rise of the q-commerce segment,” he said at the time, adding that the companies wanted to “make high-frequency purchases effortless, and we look forward to supporting Zepto to reduce cart abandonment due to failed transactions.”