Payment options abound in the market. From credit cards to UPI, there are a lot of them. However, the only service that has gained popularity recently is Buy Now Pay Later (BNPL). Consider this: Consulting firm RedSeer estimates BNPL’s market in India will grow to $ 45-50 billion by 2026 from the current market size of $ 3-3.5 billion. The number of BNPL customers is also expected to increase to 80-100 million from the current 10-15 million.
There are mainly two types of digital players in the market: payment financing and transaction financing. For example, in the case of BNPL players like LazyPay and Simpl, you don’t have to go through the long process of adding credit cards or money to the wallet or waiting for an OTP. You can simply accumulate all your invoices and pay only one invoice after 15 days. Then there are players who allow users to buy online as well as offline and pay later through EMIs.
âThere are several types of BNPL products on the market. There is a BNPL product designed by LazyPay, Simpl and OlaMoney Postpaid, where you make payment for faster payment and it is due after 15 days. Traditional finance that started with Bajaj Finance in 2007 provides zero cost EMI when you walk into a physical store. The third type of BNPL are companies like Uni where our value proposition to clients is flexibility, âsaid Nitin Gupta, co-founder and CEO of Uni.
Powered by Visa, Uni Pay offers both a physical card and a digital card. The physical card works at retailers that accept Visa cards, giving it wide acceptance. It automatically divides transactions into an interest-free third party, making it suitable for those who want short-term liquidity without being burdened with high interest charges. If you want to convert your invoices to EMI in the longer term, interest charges of 14-18% will be applied by the company. The minimum amount due must be paid in each billing cycle, or else one must pay late fees which are decided based on the slab.
The card also offers consumers the option to convert transactions to ‘Pay in Full’ at the end of the 30-day free credit period and, in return, enjoy a 1% cash back reward. .
âThe credit card is a very expensive product. They have a revolving interest. Then they charge interest on the interest and in case of late payment, interest is charged from the date of the transaction. In the case of BNPL, there are only late fees. There is no interest charge on new purchases for partial payment. BNPL is a very user-friendly product, âsaid Gupta.
Uni only offers credit to super premium customers with a desktop score of 760 and above. The card offers a credit limit of around Rs 20,000 to Rs 6 lakh depending on the risk profile of the client.
Likewise, there is another Visa powered deferred payment card from Slice. It is a youth-focused fintech startup that allows you to shop anywhere and split all bills over 3 months at no additional cost. It gives a credit limit of Rs 2000 to Rs 10 lakh. Since it targets the millennial, you don’t need to have a credit score to get the card.
This new BNPL era offers cards approved in seconds and delivered quickly with an attractive credit limit. The USP of these cards is that they are powered by Visa and can be used anywhere. âWe saw a more than 100% increase in transaction value in October alone. Uni, which launched its pay-later – Pay 1 / 3rd card in June 2021, is seeing its spending multiplied by 3 during this festive period on e-commerce platforms. Since August it has steadily increased its transactions and currently makes over Rs 100 crore in monthly disbursements. E-commerce is one of the biggest categories for Uni across all age groups (21-60), both in subways and in Tier 2 cities, âGupta said.
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