4 things to consider before choosing a buy now, pay later provider

March 10, 2022
March 10, 2022
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Flexible payment options are booming. More and more customers are taking advantage of buy now, pay later options at the digital checkout, with the industry currently worth more than $100 billion. There are plenty of good reasons for online retailers to implement. So how should retailers consider and choose a buy now, pay later solution within an increasingly growing and competitive market? This post explains retailer benefits and the critical considerations retailers should take before selecting a BNPL provider. 

A little note about us: As an anti-fraud API provider we work with both BNPL businesses as well as eCommerce companies that leverage this technology. The industry also has its own fair share of fraud challenges, so we think it's useful to understand in what ways companies are open to fraudulent techniques, how you can protect your company, and the ways a service like Fingerprint can help you stop fraud before it starts.

Looking to learn more about who the key BNPL providers are? Read about the BNPL worldwide in our latest research report, The ultimate guide to Buy Now, Pay Later.

How does a buy now, pay later payment option fit in with today’s eCommerce landscape?

The value of buy now, pay later transactions nearly quadrupled in 2020 alone. A Financial Conduct Authority survey found that 11 percent of customers used a BNPL product at some point in 2020, and this number is surging. This increase in consumer acceptance means the role of BNPL in today’s online businesses is also growing. As popularity grows, more and more customers will value deferred payment options at the checkout. As a result, companies will have to decide if they offer a BNPL service, and there may come the point where those who don’t use BNPL will be disadvantaged. 

Additionally, as more and more customers use buy now, pay later, businesses that offer BNPL payments could see fewer abandoned carts and better conversion rates. In a Deutsche Bank survey, almost half of all customers that used buy now, pay later said they wouldn’t have completed the purchase if it wasn’t an option.

How does buy now, pay later work?

Buy now, pay later is a service businesses can offer consumers to purchase items without paying the entire amount immediately. Used alongside traditional payment options at checkout, BNPL is available both online and in-person stores.

BNPL plans often offer no interest or fees on the condition of on-time payments and zero missed payments. In addition, these payment options often come with lighter credit checks than those associated with traditional lines of credit, such as credit cards. 

Instead, customers are digitally verified in a credit risk assessment when they use buy now, pay later services. From there, they can select from several flexible finance options based on their specific financial situation. 

Four things to consider while selecting a BNPL provider:

A growing number of buy now, pay later companies are emerging, offering new payment solutions to all sizes of online retailers. Affirm, Sezzle, Afterpay and Klarna are just some of the options. 

Read more: The ultimate Buy Now, Pay Later research guide.

While assessing the options, merchants need to watch out for the risks of BNPL too. So which one should you use? Consider these key points:

Choose the best BNPL provider for your business

Some buy now, pay later services are better suited to larger purchases. For example, if your business sells expensive furniture or jewelry, you might want to consider offering more flexible payment options more suitable for more significant amounts. Take a look at your average cart size and your average abandonment cart size and see if they’re large enough to warrant offering BNPL. It’s also worth considering if the service can handle the number of transactions you expect and if they can integrate into your technology stack. 

Other factors to take into consideration before deciding whether or not to offer an installment purchase option at checkout include:

  • Online reputation: Review potential providers on online software review sites like G2Crowd and Capterra to get a fuller picture of what it’s like as a BNPL provider customer.
  • Regional availability: Be sure to review regional availability for the BNPL provider you choose to make sure that provider is available to customers where you sell and ship your products to. 
  • Pricing structure: Look at the terms and feeds associated with each transaction of each provider you're considering before committing to offering a BNPL payment option to make sure you can carry the cost of any fees. 

Maximum Choice and Flexibility for Customers

Part of the reason for utilizing a buy now, pay later offering in your business is that it gives your customers more choices. Therefore, a good buy now, pay later service offers different options to suit all shoppers. However, it should do so in a way that does not complicate the shopping experience. There is such a thing as too many options if it makes it hard for customers to select the best one for them.

Be sure to review the flexibility the BNPL provider has in payment options and look for one that covers a broad range of preferences in a way that is easy to understand for your customers. You may also want to run through a demo checkout flow to get a sense of the number of pages, steps, and form fills a customer will need to complete to make a purchase using the service. 

Expanding Your Customer Base

Partnering with a BNPL company can often result in new marketing channels, such as marketplaces and website highlights. For example, take the Affirm mobile app for their users, where Affirm users can not only view and manage their current payments, but they can also view what they are prequalified at and get access to all brands that offer Affirm as a payment option at checkout. In addition, being featured by such providers exposes new markets that can help businesses expand their customer base.

This increase in customer acquisition is especially the case if the BNPL service has a loyal customer base. When evaluating a BNPL service, you may be able to ask during the sales process for some case studies of customers successfully increasing sales due to these new marketing channels. 

Protecting Consumers (and Your Customers)

Whenever you bring in a third party service provider to your business, ensuring they have your customers’ best interests in mind should be top of mind. This includes everything from the overall customer experience to fraud prevention practices in place. When a fraudster successfully takes over an account of a customer on an eCommerce account, they can use that stolen information to their advantage with a BNPL provider. This is just one way bad actors can take advantage of customer information elsewhere.

You should look at the overall customer experience your customers would encounter should they use a BNPL option during their checkout process. Are there any vague or unclear terms when it comes to pricing? Is there a 0% APR option available for every consumer? These are a couple of questions you could consider when reviewing your terms with a potential BNPL provider. 

Secondly, a BNPL provider will have access to your customers’ most sensitive information including payment methods, and other identifying information required to process their approval check. Read through their trust and security pages to make sure you understand how your customer’s data will be used, stored, and protected post-purchase. We help BNPL and eCommerce companies alike to identify fraudulent transactions and activity to prevent it from occurring at all. 


Buy now, pay later is still in its early days, but the signs are clear - it will become a more significant part of online business in the years to come. Today’s world represents a chance for online merchants to use BNPL and position themselves as forward-thinking businesses with the finger on the pulse of customer behavior. In many ways, the decision is not whether or not to adopt “buy now, pay later,” but which provider to choose. They are not all made equal or perceived in the same way by shoppers. 

By taking the time to carefully select the best buy now, pay later solution for your business, you’ll unlock the maximum benefit they provide. 

You can also learn more about how Fingerprint helps combat and prevent fraudulent BNPL transactions through our device fingerprinting technology. With a 99.5% accuracy rate for identifying unique visitors across devices and browsers, Fingerprint Pro combats even the most sophisticated fraudsters.