FinTech solution provider CellPay has partnered with Klarna to offer Klarna’s interest-free “Pay in 4” option to consumers who are buying prepaid cellphone minutes from CellPay.
With this payment option, CellPay customers can make four interest-free payments over six weeks, according to a Friday (Sept. 30) press release.
“This is the first time U.S. customers, especially underbanked, will be able to pay for prepaid cellphone minutes over time, allowing them to keep connected with their loved ones with greater flexibility,” CellPay said in the release. “Interest-free [buy now, pay later (BNPL)] is a smarter, fairer alternative to high-interest credit and gives consumers the flexibility and convenience to manage their money and budget.”
Citing research from PYMNTS, the company noted in the release that about 20% of consumers use BNPL, adding that its new partnership with Klarna will enable CellPay to offer the benefits of that payment option to its customers.
Read more: 60% of Millennials are Interested in Bank-Provided BNPL Plans, If Available
“When a CellPay customer splits the cost of their purchase into four smaller payments with Klarna, they will never pay any interest ever,” CellPay said in the release.
PYMNTS research has found that more than 6% of American households are unbanked and nearly 19% are considered underbanked, with millions of Americans struggling to access financial services.
See more: Prepaid Debit Cards Seen As Safe, Simple Way To Bank Unbanked Americans
Consumers who live paycheck to paycheck with issues paying bills and millennials are two groups of consumers who are especially likely to use BNPL or be interested in using it.
About 34% of the consumers in both groups are interested in BNPL, according to “Banking on Buy Now, Pay Later,” a PYMNTS and Amount collaboration.
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