Indian Companies Now Capitalizing on the “Buy Now, Pay Later” Scheme

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There is a reason why techniques like EMIs and credit card payments were created. Companies want to make it as easy as possible for their customers to pay for their products and services.

In the first-world countries, especially the US, top players realized the potential of the “buy now, pay later” principle a long time ago which is why advertisements with the comforting phrase “no money? no problem” flooded television airtime, magazines, etc. However, India has started to catch up with it finally.

A New Wave of Payment Services

A large number of startups in India are now allowing the users to pay for movies, food orders, utility bills, etc. without having to actually pay first. For instance, Epaylater entered into a contract with IRCTC to allow the railway passengers to book tickets without having to pay immediately, a remarkable feat that immediately made headlines. However, that’s not it’s only USP today. It offers up to Rs. 20,000 spending limit to its users for the payment of bus bookings, hotel bookings, mobile recharges, etc. The users can create accounts easily with their Aadhaar number of PAN.

India’s domestic e-commerce leader Flipkart is another important example of the new-age “easy payment” model. Under the “Flipkart Pay Later” service, it allows the users to purchase products without paying immediately. The interest of the retailers is protected by penalties of different amounts for the users who default. For instance, an outstanding amount up to Rs. 2,000 attracts a fine of Rs. 100, up to 4,000 a fine of Rs. 200, etc. The users also have to agree on the T&C which further allows the e-commerce giant to take appropriate action against the rogue users.

The thing is that online shopping is extremely popular among the millennials. So, e-commerce websites can track the shopping history of its customers to select the ones that pose the minimum risk that can be offered the “pay later” perk. Plus, not everyone wants the responsibility that comes with credit cards, which is why the service appears to be more suitable.

Startups and fintech companies offering the “pay later” service are enjoying huge growth today. For instance, PayU’s LazyPay service is observing 100% month over month (MoM) growth, which is more than impressive.