Amazon launches ‘buy now pay later’ service with Barclays
Amazon has entered into an agreement with Barclays to enter the booming buy now, pay later (BNPL) market in Britain.
Amazon has called the new venture “Instalments” and the payment method will enable customers to spread the cost of purchases over £100 over equal monthly instalments between three and 48 months after purchase.
At the checkout, customers must complete an online application and if approved, customers will find their reusable credit account added to their wallet. Payments are automated via Direct Debit, giving customers a simple and convenient way to pay off their purchases on time, and the account can be managed directly through the Barclays App, even if the customer doesn’t bank with Barclays.
Barclays offers this credit account at an APR of 10.9% for online purchases on Amazon, although promotional rates and interest-free financing may be available at times. There are no account management fees, late fees, statement fees, or other hidden fees.
The ecommerce giant first launched the product in Germany last year but this partnership marks Amazon’s entry into the UK BNPL market, which was spearheaded by Swedish company Klarna.
“Every day we strive to innovate on behalf of our UK customers. Instalments is one way we will offer customers flexible options, enabling them to choose to pay now or split the cost of larger purchases into budget-friendly monthly instalments,” Amazon UK head of instalment lending Rob Levy said.
“This is a simple and transparent service from Barclays that automates monthly payments, providing greater comfort for customers making bigger purchases.”
Although popular with buyers and retailers, the UK’s Financial Conduct Authority has raised concerns about BNPL. The watchdog said the payment method could act as a debt trap and called for “urgent” space regulation early this year.
