PayPal offers an enticement for customers by allowing them to “buy now, pay later,” and on Wednesday, it made the offering more attractive by eliminating late fees.
PayPal announced it will no longer charge late fees for missed payments on buy now, pay later products globally. Starting October 1, new customer purchases with Pay in 4 in the US, Pay in 3 in the UK, and Pay in 4X in France will no longer be subject to late fees – joining PayPal’s buy now, pay later solutions in Germany and Australia, which do not charge late fees for missed payments.
“Eliminating late fees builds on PayPal’s commitment to deliver the most customercentric, global installment solution portfolio that helps meet the needs of today’s consumers and merchants,” the company said.
According to a recent CNBC article, “Younger generations are hopping on the trend to save money, buy clothing and keep up with their peers instead of using traditional credit cards.”
PayPal pointed to the benefits of such programs to online sellers. “Merchants who offer Pay in 4 benefit from the fact that 50 percent of consumers make additional PayPal pay later purchases within three months of their first purchase and 70 percent within six months.”
It also wrote in its press release, “PayPal’s Pay Later offering comes at no additional cost to merchants, while boosting their conversion rates and increasing cart sizes by as much as 39 percent.”