PayPal is to take on the likes of Klarna and Australia’s AfterPay with the launch of a buy now, pay later shopping service that lets UK consumers pay for their purchases in three monthly instalments.
Through PayPal Pay in 3, businesses can offer their customers the option of making purchases between £45 and £2,000 by paying over three, interest-free payments, with seamless automatic re-payments each month. PayPal Pay in 3 will also appear in the customer’s PayPal wallet, so they can manage their payments online or via the PayPal app.
Retailers including Crew Clothing, French Connection, Robert Dyas and Ryman have signed up for the product, which will go live later this month..
The move follows the August release of a ‘Pay in 4’ product in the US in the lead up to the busiest shopping season of the year.
As online purchases increase and consumers look for more ways to save due to Covid-19, buy-now-pay-later has accelerated in popularity, marking up a 39% year-on-year increase in the proportion of buy now, pay later payments in the UK in 2019. This trend is expected to double by 2023, according to figures from WorldPay.
Rob Harper, UK director of enterprise accounts at PayPal, says: “During the coronavirus pandemic, we have seen the number of people in the UK shopping online increase dramatically. At the same time, many more consumers are looking to spread the cost of those purchases. We have developed PayPal Pay in 3 to meet that need, building on our heritage as a responsible lender through PayPal Credit, which we launched in the UK in 2014, and has served more than two million customers to date.”