Buy now, pay later: Is this the new Fintech mantra?
Several fintech start-ups have started offering customers the option make purchases without paying at the time of the transaction. Customers can then pay all the items purchased together at a later date.
Key highlights:
- Several fintech and lending start-ups have come out with deferral payments scheme
- The micro-credit involves lending amounts of Rs 2,500 up to even Rs 10,000 on purchases
- Paytm, Amazon and even Flipkart are said to be interested in it
Fintech start-ups now seem to be in the race to develop micro-credit products for people shopping online. The micro-credit or deferral payment facilities allow people to purchase smaller items such as clothes, groceries, food, movie tickets, etc and pay at at one go at a later date.
While fintech start-ups PayU India recently launched its deferral payment feature LazyPay, there are others such as Mumbai-based fintech start-up Simpl, Quiklo, Krazybee and ePayLater which allows you to do the same. Even ZestMoney, Rubique and LoanTap are fintech companies offering such payment options.
PayU to spend $50 million on development, marketing of LazyPay feature
It is not only these merchants, but large e-commerce and digital wallet companies such as Flipkart, Amazon and Paytm are also in the process of offering micro-credit payment options to their customers and have partnered with some of the fintech companies.
PayU's biggest competitor Paytm is also said to be looking to add credit products to its wallet and is partnering with companies such as ZestMoney and LoanTap, according to a recent Economic Times report.
While Amazon which launch launched its own Amazon Pay wallet is expected to launch a suite of financial products which include credit lines, insurance, among other to customers purchasing on its platform.
Flipkart is also reported to be discussing launching financial products in partnership with three digital lending players.
The reason many of these fintech start-ups to look at the micro-credit space in a serious way is the opportunity they hold. These fintech start-ups which offer lending facilities can partner with large consumer internet companies which offer them an instant reach to millions of potential customers.
People shopping online is expected to cross 100 million by 2017 end from 69 million who shopped online in 2016, according to a recent Assocham-Resurgent India report.
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