FinTech digital banking startup Upgrade is jumping into the buy now, pay later (BNPL) space with a product that allows users to pay off their outstanding debt in four months with no interest, according to a CNBC report Friday (Oct. 1).
Upgrade creates installment plans to allow users to pay down their debt over six to 36 months with a fixed interest rate. The company expects to rollout the BNPL initiative in the coming months, Upgrade CEO Renaud Laplanche told CNBC.
“We are working on a version of the Upgrade Card that’s better suited for smaller expenses,” the CEO said. “In that case, we don’t need to charge interest because it’s a smaller amount.”
Upgrade’s product will differ from other BNPL offerings since it features a checkout option on merchants’ websites to allow Upgrade to group a user’s card purchases into one lump sum and invoice them what they owe over four months.
“What we like about embedding the product into a card is the broader acceptance,” Laplanche told CNBC. “BNPL often relies on partnerships with merchants. It’s starting to get mainstream online, but not so much in-store.”
Upgrade reached a $3.3 billion valuation in August after a $105 million Series E funding round, but Laplanche told the news outlet it will be a while before the company goes public, although he wants it to be ready for its initial public offering within 18 months.
The company paid $7 billion in credit since its founding in 2017 and could match that amount this year.
Related: Upgrade Valued At $3.325B After Series E Fundraising Round
Upgrade debuted a rewards checking account earlier this year that gives customers 2 percent cash back and launched the Upgrade Bitcoin Rewards Card in July that allows users to be paid in Bitcoin or cash.
Upgrade also announced its move into mobile banking in January with a debit rewards product that gives customers cash back when they use funds on hand to cover everyday expenses.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More