The Buy Now Pay Later provider, Clearpay, is aiming to launch an in-store option next year, as the sector eyes the high street as the next frontier in its expansion.
The business, part of Australia’s Afterpay, has 1.2 million users in the UK who use Clearpay to spread out payments while shopping online. Adding an in-store option will allow shoppers to take items home without paying the full price upfront.
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In an interview with i, Clearpay’s UK chief executive, Carl-Olav Scheible, said: “It’s the fastest growing part of our business in Australia so it’s important. Retailers and consumers love it.”
He added that the rollout could have come sooner if Covid-19 lockdowns had not delayed the initiative.
High street partnerships
In the meantime, Clearpay has this week partnered with a selection of new retailers including Topshop and Topman, Pandora, Jo Malone, Clinique and H Samuel in preparation for a Christmas shopping season expected to take place mostly online.
The move to offer its services in stores would see Clearpay follow hot on the heels of its rivals, Klarna, which already operates a service for bricks-and-mortar shopping, and Paypal, which is testing store usage after launching its “pay-in-3” offering last month.
Shifting consumer habits
It comes at the same time as the Buy Now Pay Later sector is facing increased scrutiny, with the Financial Conduct Authority currently looking into the services as part of a review of unsecured credit. Recommendations from the review are due to be presented early next year.
Mr Scheible said it was understandable that the relatively young industry would be put under the microscope. “When something doesn’t fit into a defined bucket and something is new, the regulator needs to look at it,” he said. “We are not regulated but we do work with the FCA and are compliant around their guidelines.”
Part of the concern regarding Buy Now Pay Later is that the products primarily appeal to younger consumers, leading campaigners to fear they are being encouraged to make reckless spending decisions. But Mr Scheible said that the popularity of the services was part of a wider shift in the makeup of the global payments industry.
“The cheque has all but disappeared. Cash is being significantly reduced On plastic, credit vs debit, credit cards are way down.”
He said that Buy Now Pay Later is replacing credit cards among younger shoppers who have a “mistrust of traditional financial products”.