Introduction
When money is tight, a credit option like “Buy Now, Pay Later” could save your life. Anyone can run into big money problems out of the blue, so it’s always a good idea to have low-interest credit options available.
There are many Buy Now, Pay Later programs in India. Those who qualify can get a loan for up to Rs. 5 lakhs at competitive rates. Your credit score affects the amount of credit you can get and the interest rate you pay. If you have a good credit score, you can immediately get a big line of credit. The interest rates on these loans are meagre and go down daily. You’ll save money on interest rates every time you make a payment.
Read more: What is fintech?
This article will look at India’s best Buy Now Pay Later apps. These apps give their users access to different payment plans and perks. First, let’s quickly go over what BNPL is and how it works.
What’s the deal with “Buy Now, Pay Later?” When does it start to work?
Customers eligible for Buy Now Pay Later (BNPL) get an instant credit limit based on how much money they have in their bank account and what they have bought in the past. When deciding on a loan, among other things, the credit score is taken into account. Because of this, this strategy is available to people with lower credit limits. You can spend the most money in both online stores and real stores. This type of loan usually has terms of 30 days to pay it back without interest. Users can also choose between three, six, nine, or twelve easy EMIs with a lower interest rate.
What’s Next for Buy Now Pay Later?
Since the idea is likely to make more people want to buy things right away, the future of BNPL could be bright. Lenders who offer this service usually let borrowers pay back their loans in monthly instalments (EMIs) with no interest. It will likely become the most popular way to repay loans, especially for younger borrowers.
But at the end of the day, it’s still a loan that the customer has to pay back. Lenders who offer this service need to be careful because not every borrower can pay back the loan in the time allotted. If a customer doesn’t pay on time, their credit score will go down, and they’ll have to pay interest. BNPL has a bright future if customers use the service well and pay off their balances on time.
Top 5 Buy Now Pay Later Platforms In India
Listed below are the top 5 Fintech Buy Now Pay Later platforms in India:
1. Simpl
Since its start in 2015, Simpl has grown quickly to become a strong competitor in India’s BNPL market. The mobile-first technology used by the startup makes account approval quick and lets people buy things online with just one touch. All purchases made on the internet are kept in one place (the Simpl account), and the total amount must be paid every 15 days. The company does not charge interest, but there may be late payment fees.
More than 7 million people use simple, and the company has worked with more than 4,500 retailers in India. So far, investors like IA Investments and Green Visor Capital have given the company nearly US$26 million. In the year before Covid, the company’s online orders for necessities went up by 50% every year. Also, the average ticket price in 2020 went up by 1.5.
2. ZestMoney
ZestMoney is one of India’s new financial companies that has done the best so far. The company’s service is unique because customers can immediately buy what they want and pay for it in easy monthly instalments. The new company’s platform uses digital banking, artificial intelligence (AI), and mobile technology to give consumer loans to people who haven’t been able to get them in the past.
ZestMoney is a different kind of loan platform for consumers. It stands out by connecting with online stores. For example, ZestMoney can pay for expensive things like furniture or plane tickets, which most traditional lending platforms don’t cover. ZestMoney also lets you pay for purchases over six months with no interest at stores that accept it.
3. Amazon Pay Later
Amazon made the Pay Later option available in 2020 to meet the growing need for consumer loans after the epidemic. Customers in India can use Amazon Pay Later on their computers and phones to buy a wide range of things they need daily. But now, Amazon Pay Later is only available to people who use the Amazon app on their phones. Users can get credit with no interest for 15 days and then pay it back in three to twelve monthly payments with interest.
Since it started, Amazon Pay Later has been used for more than 10 million transactions, with 99.9% of those payments going through. Users of Amazon Pay Later can get up to $1,300 (INR20,000) in credit quickly. This amount can be raised by updating their “know-your-customer” credentials.
4. Flipkart Pay Later
After Amazon started offering BNPL, Walmart’s online shopping rival, Flipkart, did the same thing a year ago. This method gives you a grace period of up to 35 days to make payments. And since no other payment plan lets you pay back only part of your bill, Flipkart Pay Later is a unique service. Customers can pay a minimum amount each month on or before the 10th (which includes a convenience charge). The user can pay off the outstanding amount during the next billing cycle. If they use the same payment method, their account won’t be penalized or closed.
5. Lazypay
LazyPay is a mix of Simpl and ZestMoney. It has features from both of those services. Customers can purchase with one touch, pay off their balances every 15 days, or switch to equal monthly payments (EMIs). Loans of up to about $1,300 are available through the new business (INR 100,000). More than 250 websites in India accept LazyPay. With this service, you might not have to complete much paperwork to get your credit.
PayU Finance is a part of PayU, a payment systems company owned by Naspers. It does business as LazyPay. By the end of the year 2020, 2 million people used LazyPay. The platform has also given out more than US$67 million in credit and has been used for more than 10 million transactions.
Conclusion
If you have an urgent purchase to make but no cash on hand, a BNPL payment method is a great compromise. This payment method is fast, easy, and flexible when utilized correctly.
Many payment-processing giants are also considering broadening their offerings to cater to this market. That’s reasonable enough, after all. The growth of this market is good news for everyone involved, from lenders to customers.