PayPal Announces Increase of its Buy-Now-Pay Later Service
Dec 1, 2021 By MarketDepth
PayPal (NASDAQ: PYPL) experienced an increase in use of its buy-now-pay-later payment service during Black Friday. In an interview with CNBC’s Jim Cramer, CEO Dan Schulman said that the company’s installment payment service is “one of the stars, actually, of the holiday season for us.”
“During Black Friday, our volume on buy now, pay later was up almost 400% year over year. We did some 750,000 transactions alone in one day on Black Friday.”CEO, Dan Schulman
The Pay in 4 platform was launched in the US within 2020 and ultimately permits customers to pay their balance in four interest-free installments. According to Schulman, in November the company recorded over USD1 Billion of process volume through its buy now, pay later alternative, for the first time ever.
“We did over 1 million first-time users for the first time ever in a month, well over 10 million consumers.”CEO, Dan Schulman
Throughout the coronavirus pandemic, the new service has become popular among consumers. Furthermore, other tech companies are moving to benefit from the market, with companies such as Affirm striking a game-changing deal with Amazon.
Better Than Credit Cards
According to industry advocates, buy now, pay later programs are better than credit cards as there are fixed monthly payments and all interest is established at the start.
“These products do encourage people to pay purchases off quicker and usually with less interest, but if people are using them to simply buy more than they should and getting over their heads, paying late fees, etc., are they really helping manage people’s expenses?”Lauren Saunders, associate director for the National Consumer Law Center