Bruce McIntosh, CEO of Payflex - which claims it owns about 60% of the market - said the industry has seen 100% year-on-year growth as the category becomes more mainstream, expanding from its roots on e-commerce platforms and into brick-and-mortar retail stores.
"With rising inflation and interest rate increases, South African consumers are looking to maintain their lifestyles without the exorbitant fees imposed on them by traditional credit providers," McIntosh said in e-mail correspondence with TechCentral.
"Average order values typically increase by up to 30% with a BNPL checkout, exemplifying the consumer mindset towards buying more items, or more expensive items that they may not typically buy if they had to use a payment solution that charged interest."
Today's digital BNPL solutions, typically offered by fintech companies, are 21 st -century versions of traditional lay-by or lay-away options offered in brick-and-mortar retail outlets since the Great Depression of the 1930s.
Secondly, BNPL options gives customers the ability to upgrade their purchases, opting for higher-value items with larger profit margins for retailers.
