The Pros and Cons of Buy Now, Pay Later: A Boon for E-commerce Stores

A BNPL payment option could prove pivotal in boosting your sales.

BNPL could be an attractive option for customers and a lucrative option for merchants

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The rapid growth of e-commerce has led businesses to explore new and innovative ways to increase sales and improve customer experiences. One such ecommerce payment gateway method that has gained significant traction is the Buy Now, Pay Later (BNPL) payment option. In this article, we will delve into the advantages and disadvantages of offering a BNPL payment method for e-commerce stores, with a focus on the numerous benefits it brings to both consumers and businesses.

Advantages of BNPL for E-commerce Stores

Increased Sales and Conversion Rates For Online Stores

The primary advantage of offering BNPL is the potential for increased sales and conversion rates. By allowing customers to defer payments, BNPL encourages them to make purchases they might not have otherwise, due to financial constraints. This can lead to higher average order values, as customers are more likely to add extra items to their cart, knowing they can spread the cost over time.

Enhanced Customer Loyalty

BNPL can contribute to greater customer loyalty and encourage repeat purchases. By providing a convenient and flexible payment method, businesses can create a more positive customer experience, which, in turn, can increase the likelihood of future purchases. The extended payment options make customers feel valued and appreciated, which can foster long-term loyalty.

Attraction of New Customers

Offering BNPL options can attract new customers who may not have previously considered shopping with your e-commerce store. The availability of a deferred payment plan can be a deciding factor for customers comparing similar products and businesses, ultimately swaying their decision in your favor.

Reduced Abandoned Carts

One of the main reasons customers abandon their shopping carts is due to concerns about affordability. BNPL options alleviate these concerns by allowing customers to manage their finances more effectively. This can lead to a reduction in cart abandonment and a boost in overall sales.

Competitive Edge

As more e-commerce stores adopt BNPL payment methods, it becomes increasingly important for businesses to keep up with the trend. Offering BNPL can provide your store with a competitive edge over other retailers who may not yet offer this service. In an increasingly crowded market, BNPL can help set your business apart and attract more customers.

Disadvantages of BNPL for E-commerce Stores

Risk of Default

One downside of offering BNPL is the potential risk of customers defaulting on their payments. While many BNPL providers absorb this risk and provide businesses with the full payment upfront, some arrangements may require the retailer to bear the risk of non-payment.

Processing Fees

BNPL providers typically charge fees for their services, which can cut into a retailer's profit margin. Although these fees are generally reasonable and offset by increased sales, they can still impact the bottom line. It is essential for businesses to carefully consider the fee structure before implementing a BNPL option. Potential for Encouraging Overspending

While BNPL can boost sales, it is important to consider the ethical implications of potentially encouraging customers to spend beyond their means. Retailers should ensure that their marketing efforts for BNPL options are responsible and transparent, outlining the full terms and conditions of the agreement to avoid potential backlash.

If you're a merchant in Malaysia, a popular payment method option to consider is FPX or Financial Process Exchange. It's been the number 1 online payment method for a couple of years now in Malaysia.


In conclusion, offering a Buy Now, Pay Later payment method can bring numerous benefits to e-commerce stores, such as increased sales, enhanced customer loyalty, and a competitive edge. While there are some disadvantages, such as the risk of default and processing fees, the advantages generally outweigh the drawbacks. By carefully considering the implications of BNPL and partnering with a reputable provider, businesses can leverage this innovative payment method to drive growth and improve customer satisfaction.

BNPL is offered by many major ecommerce payment gateways. For example, PayPal calls their Pay Later with options to Pay In 4 instantllments or pay monthly. However, these options may not be offered in all countries where PayPal services are available...yet. The good news is that local payment gateways are now starting ot offer BNPL services as well. For example, Malaysia ecommerce payment gateways like Atome and Senang Pay also offer BNPL payment gateway options with attractive rates.