Barclays US, which offers a range of co-branded credit cards for middle-income consumers, is offering its trading partners the Buy Now / Pay Later option.
Working with Chicago-based fintech Amount, Barclays plans to develop a white label POS installment loan tool in the coming months to complement its existing co-branded and private label credit cards, the companies said Tuesday known.
“The ‘buy now, pay later’ trend is very strong and growing, complementing credit cards where people want to finance a particular purchase by paying in installments,” Denny Nealon, CEO of Barclays US Consumer Bank, said in an interview.
The demand for BNPL options is most popular among younger consumers, but includes all ages, according to Nealon.
“As we saw in the e-commerce boom during the pandemic, consumers are still spending on credit cards. But there are many use cases in the travel industry where people want different, more flexible payment terms for a particular purchase, ”said Nealon.
Barclays and Amount will develop a bespoke approach for every trader who adds BNPL.
“It will match the lifestyle and purchasing habits of consumers to create and reward loyalty rather than just providing a new channel of transactional revenue,” said Nealon.
Barclays did not disclose which of its co-branded credit card customers are interested in adding BNPL offers through Amount. Barclays’ co-branded credit card partners include American Airlines, JetBlue, Wyndham, Choice Hotels, and a few others.
Amount creates an approach where Barclays co-branded credit card customers can seamlessly renew BNPL loans at the checkout alongside co-branded and private label cards without applicants having to leave participating merchants’ websites, Nealon said.
It was too early to talk about the terms and fees for Barclays’ BNPL programs, which the bank is still developing, he said.
Amount, a spin-off of Chicago lending firm Avant, specializes in white label digital banking and credit solutions and has partnered with Regions Bank and Banco Popular on BNPL programs, said Adam Hughes, CEO of Amount.
“Banks come to us for bespoke BNPL services for private label, which is currently the fastest growing part of our business,” said Hughes, noting that one of the appeals is to have customers on the merchant’s website throughout the BNPL or the bank to keep the application and approval process instead of being directed to a third party website.
“There’s a higher trust and follow-up rate when consumers stick with the original website throughout the process of applying for an installment loan,” said Hughes.
Many merchants support third-party BNPL options in addition to co-branded and private label cards.
Barclays recently signed a long-term agreement to Handling of all co-branded and private label credit cards for The Gap starting May 2022. The deal includes tickets for The Gap, Old Navy, Banana Republic and Athleta.
The gap in November 2020announced a partnership with Afterpayand PayPal for installment loans at the point of sale.
Barclays last month launched a new Mastercard brand AARP credit card, which replaces AARP’s previous Co-branded Visa card with Chase. Barclays’ AARP Essential Rewards Mastercard has no annual fee and offers users $ 100 cashback if they spend $ 500 in the first 90 days. The card offers 3% cashback for purchases at gas stations and drug stores (minus Target and Walmart) and 1% at other locations.