Barclays US, which offers a range of cobranded credit cards targeting middle-income consumers, is adding a buy now/pay later option for its merchant partners.
Working with the Chicago-based fintech Amount, Barclays plans to develop a white-label POS installment loan tool in the coming months to complement its existing cobranded and private-label credit cards, the companies announced Tuesday.
“The buy now, pay later trend is very strong and growing, and it complements credit cards where people are looking to finance a specific purchase through installment payments,” said Denny Nealon, CEO of Barclays US Consumer Bank, in an interview.
Demand for BNPL options is most popular with younger consumers, but it spans all age groups, according to Nealon.
“As we saw from the e-commerce boom during the pandemic, consumers are still spending with credit cards. But particularly in travel, there are many use cases where people want different, more flexible payment terms for a specific purchase,” Nealon said.
Barclays and Amount will design a customized approach for each merchant adding BNPL.
“It will match consumers’ lifestyles and purchasing habits to create and reward loyalty more than merely providing a new transactional revenue channel,” Nealon said.
Barclays did not disclose which of their cobranded credit card customers are interested in adding BNPL offers through Amount. Barclays' cobranded credit card partners include American Airlines, JetBlue, Wyndham, Choice Hotels and several others.
Amount is creating an approach where Barclays’ cobrand credit card customers will be able to seamlessly extend BNPL loans at checkout alongside cobranded and private-label cards, without requiring applicants to leave participating merchants’ sites, Nealon said.
It’s too soon to discuss what the terms and fees may be for Barclays’ BNPL programs, which the bank is still developing, he said.
Amount, a spinoff of Chicago lending firm Avant, specializes in white-label digital banking and lending solutions and has worked with Regions Bank and Banco Popular on BNPL programs, said Amount CEO Adam Hughes.
“Banks are coming to us for customized, private-label BNPL services, which are the fastest-growing part of our business right now,” Hughes said, noting that one of the appeals is keeping customers on the merchant’s or bank’s website throughout the BNPL application and approval process, instead of being directed to a third-party site.
“There’s a higher trust and follow-through rate when consumers stay on the original website throughout the process of applying for an installment loan,” Hughes said.
Many merchants support third-party BNPL options alongside cobranded and private-label cards.
Barclays recently signed a long-term agreement to
The Gap in November 2020
Barclays last month
