Report: Monzo Jumps Into BNPL

Digital bank Monzo will soon enter the buy now, pay later (BNPL) market, according to a report from the Evening Standard Friday (Sept. 10) that quoted two industry sources, a move that would make it one of the first regulated banks with a BNPL offering.

The announcement could come next week, according to the report, in which a Monzo spokesperson declined to comment. The Standard also reported recently that Revolut is working on a BNPL product of its own. Barclays will also enter the BNPL fray, joining PayPal, Afterpay, Clearpay and Klarna.

Monzo’s BNPL rollout will feature affordability checks for customers, one of the sources told the Evening Standard. Monzo will also share customer data will also be shared with credit checking agencies, according to the report.

Related: BNPL’s Pitch To Merchants Goes Beyond Installment Plans To Deep Data Dives

PYMNTS research found that about 61 percent of small and medium-sized businesses (SMBs) say customers would switch to merchants that provide BNPL options and that BNPL allows for sales that would not take place in its absence.

PYMNTS’ September Buy Now, Pay Later Tracker highlights four ways BNPL providers are helping their merchant partners: by bringing new customers, increasing customers’ trust, providing extensive data and driving additional sales.

Also read: Offering BNPL Is Key to Unlocking Retail Spend for One-Quarter of US Consumers

PYMNTS research reveals that 23 percent of American adults need a “second chance” to gain access to affordable payments that come with higher credit scores. BNPL programs allow consumers to split purchases into small installments and do not charge fees for joining the service.

A recent PYMNTS and Sezzle survey, The Second-Chance Consumer: How Buy Now, Pay Later Payments Create New Merchant Opportunities, examines the impact of BNPL programs on consumers’ access to the retail marketplace.

The report highlights the ways consumers who are otherwise fiscally stable may have experienced interruptions in their ability to make payments on time since the COVID-19 pandemic began in the spring of 2020.