As e-commerce continues to evolve and expand, retailers and financial institutions constantly look for new ways to attract and retain customers. One of the latest trends in this space is the rise of "buy now, pay later" (BNPL) services, which allow shoppers to purchase goods and services without immediate payment, and instead pay for them over time.
In December 2021, Amazon, one of the world's largest e-commerce platforms, partnered with Barclays, one of the UK's largest banks, to offer BNPL services to customers in the UK. The partnership will allow Amazon shoppers to purchase items and pay for them in installments, lasting between 3-48 months, using the Barclays Partner Finance platform.
This move is strategic for both Amazon and Barclays, as BNPL services have become increasingly popular among consumers in recent years. According to a study by Klarna, a leading BNPL provider, more than a third of UK consumers have used BNPL services in the past 12 months. Other popular BNPL providers in the UK include Clearpay and Laybuy.
The partnership between Amazon and Barclays is expected to be a win-win for both companies and consumers. Amazon will be able to attract more customers and increase sales, while Barclays will be able to offer its customers an additional service and potentially increase its loan portfolio.
Consumers will also benefit from the partnership, as they can purchase items on Amazon and pay for them over time without paying interest. Additionally, the partnership will allow consumers to purchase items they may not have been able to afford otherwise.
How the Partnership Works
The partnership between Amazon and Barclays will work by integrating the Barclays Partner Finance platform into the Amazon checkout process. When customers are ready to purchase on Amazon, they can pay for the item in four interest-free installments using the Barclays platform.
Once the customer has chosen to pay in installments, they will be prompted to enter their personal and financial information, including their name, address, and bank details. This information will determine the customer's eligibility for the installment plan.
Once the customer's information has been verified and their eligibility has been confirmed, the purchase will be processed, and the customer will be able to pay for the item in four interest-free installments. The first installment will be charged at the time of purchase, with the remaining installments being charged at 30-day intervals.
Why the Partnership is Important
The partnership between Amazon and Barclays is important for several reasons. Firstly, it allows Amazon to offer a new service to its customers, which can help attract and retain more shoppers on the platform. Secondly, it allows Barclays to offer its customers an additional service and potentially increase its loan portfolio.
Additionally, the partnership is important because it helps to address a problem that many consumers face: the inability to afford to make large purchases all at once. By offering a BNPL service, Amazon and Barclays are making it possible for more consumers to purchase items they may not have been able to afford otherwise.
The partnership between Amazon and Barclays is a strategic move expected to benefit both companies and consumers. By offering a BNPL service, Amazon can attract more customers and increase sales. At the same time, Barclays can offer its customers an additional service and potentially increase its loan portfolio. Consumers will benefit from the partnership as well, as they will be able to