Viewpoints

The BNPL market has seen significant growth, with 46% of the top 1,000 retailers now offering BNPL options. Among the BNPL models that have emerged, is merchant-funded BNPL. But what is this model exactly? How does it operate, and why is it particularly attractive to merchants and PSPs?

The BNPL market has seen remarkable expansion, with a valuation of USD $25.5 billion in 2022 and projections to reach USD$160.7 billion by 2032. Over the years, various BNPL models have emerged, each tailored to different needs. Among these, the at-purchase off-card BNPL model stands out. But what is this model exactly? How does it operate, and why is it particularly attractive to payment service providers?

The BNPL market has seen explosive growth, with global usage increasing six-fold between 2019 and 2023. As industry players rush to stake their claim in this thriving market, it has become clear that BNPL is far from a one-size-fits-all solution. Various models have emerged, each with its unique characteristics and appeal. One of the most prominent among these is the post-purchase off-card BNPL model. But what exactly is this model? How does it work, and who does what businesses is it suitable for?

The world of BNPL is not one-size-fits-all; it's a rich tapestry of options, each with its own unique set of features and benefits, and FIs and PSPs must carefully consider which model, or combination of models, is right for them to help grow their business.

With the local BNPL market estimated to have reached US$900 million at the end of 2023 and projected to soar to US$1.6 billion by 2028, it's clear that BNPL is more than just a passing trend — it's a fundamental shift in consumer behaviour.

Since its inception, Pix has skyrocketed in popularity, challenging the dominance of cash and card markets. The numbers are staggering, with Pix's usage surging by 74% in 2023 alone, facilitating close to 42 billion payments across Brazil and surpassing the number of debit and credit card payments by 23% according to the country’s central bank. This growth has spurred intense speculation among banking and payment experts, raising the question: could Pix replace cards in Brazil?

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Amidst the multitude of fintech providers targeting merchants, traditional banks stand uniquely positioned to serve consumers. Boasting substantial customer bases and long-standing relationships built on trust, banks are well-equipped to step into the BNPL arena.

Payments are an everyday facet of people's lives, whether you are a regular consumer, a business or beyond. And the industry is constantly working to innovate and create new and better ways to pay. In this webinar, we take a look at the disruption of the traditional payments ecosystem and the opportunities fintechs have taken to revolutionise the way people pay.