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Within the Buy Now, Pay Later (BNPL) industry, a lot has changed since the point-of-sale loans rose to the spotlight in 2020: providers are maturing and making a pivot into profitability.  BNPL is growing across the world, expected to account for roughly 25% of all e-commerce transactions by 2026. By 2027, the market size is expected to explode to $744 billion, growing at a CAGR of 25%. BNPL is here to stay. But what that looks like is still being decided. 

Consumers and businesses alike are increasingly turning to BNPL to make purchases more manageable, from everyday needs to critical business resources. New BNPL verticals are popping up globally, covering everything from B2B credit to healthcare to groceries. 

Discover the newest trends in this rapidly expanding industry and the companies working to put them on the map.

• Hokodo – Buy now, pay later is becoming increasingly popular among retail merchants, so offering payment options for B2B purchases is a unique twist. Today, B2B merchants are essentially forced into offering payment terms to their customers with outdated methods of credit management – including paper-based applications, manual credit checks and painful invoicing programs. Enter in Europe-based Hokodo, which aims to make selling to business buyers easier. Business buyers shop on selected merchant’s sites, with real-time offers of payment terms, “powered by Hokodo’s trade credit APIs.” They claim that the wrong payment options are one of the biggest reasons that B2B buyers drop out of a sales funnel – will BNPL help increase that conversion rate? Hokodo thinks so. Recently, Hokodo partnered with French marketplace-focused fintech Lemonway to power Europe’s B2B marketplaces by offering online credit. This comes as a much-needed alternative for cash-strapped businesses struggling through a worldwide capital crunch.

Also, read: What is Banking as a Service?

• PrimaHealth Credit – In countries without government-funded healthcare, both necessary and elective health treatments are out of reach for many. A report from Financial Technology Partners notes that only 23% of Americans can afford a medical bill of over $2000. Subprime credit scores, or individuals without any credit history at all, means significant market opportunities for BNPL services in healthcare. PrimaHealth Credit’s mission is “helping more patients say yes to treatment,” with simple, transparent payment options offered by healthcare providers at point of care. Giving people more affordable options to access the healthcare they need can always be considered a win.
• Sunbit – BNPL isn’t just for wish-list clothes and vacations. Sunbit aims to help consumers pay for everyday items that some of us take for granted, including automotive, optical, and dental services. The organization’s model is to offer back-end services to the businesses where these essential transactions take place – like your local dentist or optician’s office or the dealership that already has your car up on a hoist. “Sunbit’s flagship product allows businesses to guide customers through the financing process, which is integrated with their own point-of-sale systems” for a more seamless customer experience. Providing payment options for services that are prone to becoming unexpected expenses is also a very forward-looking proposition: millennials are by far the age cohort that is most likely to have to use a payment plan for unexpected medical and self-care bills.

• Deferit – As with healthcare and other medical services, there are certain essential items that we all need to pay for. Deferit, an Australian-based organization, lets customers split utility, telco, car registration or childcare bills into installments. With a vow to empower customers, including options to change payment terms, Deferit has created an easy budgeting tool for payments, eliminating interest and annual fees.
• Flex – While we’re talking essential services, housing comes to mind. Many people face hard choices on where their money goes each month – rent or food or other essentials – especially amidst today’s economic uncertainty. There are estimates that $5 billion in late fees goes to landlords every year. Flex understands these challenges (and the stress they cause!) and aims to get you out of paying late fees by covering your rent for you and offering flexible options to pay them back, without any hidden fees or interest.

• Flava – Billed as the UKs first Buy Now, Pay Later supermarket, Flava offers zero interest and an initial ‘basket’ credit of £100, which can increase to £320 per order once re-payment history is established. Offering a full range of brand-name grocery products, delivery to your door, and flexible repayment plans, Flava aims to help customers with food insecurity stock their cupboards amid economic uncertainty.

• Zip – One of the leaders of BNPL, Zip (formerly known as QuadPay) offers payment options for retail giants, including Apple, Amazon, Walmart and Target, as well as exclusive retail partnerships. With categories covering everything from education and pets to shoes and travel, Zip is available on a variety of platforms as well as in physical retail locations, providing you with interest-free options virtually anywhere you want to shop.
• Simpl – Indian startup Simpl has a straightforward mission – make it easy for people to purchase what they like, when they like, with installment payment terms. In a country with complicated financial systems that often make it difficult for people to obtain credit, Simpl allows its users to buy now and pay at a more convenient time. With a full-stack, mobile-first platform for credit-based payments, Simpl enables one-click purchases and promises full transparency to its users and merchants alike.
• Paidy – In Japan, many consumers prefer not to use credit cards for online payments, leaving massive opportunities for alternative options like BNPL. Japanese fintech Paidy allows consumers to shop at a variety of online retailers with a convenient mobile app that only requires your email address and phone number – repayments in installments can happen via bank transfer, direct debit and even in convenience stores, all by just showing the app.

• Sezzle – Sezzle offers typical installment payment plans, but also features some products exclusive to their users that they call strategic differentiators. Sezzle Up for example, lets a shopper build their credit rating by enabling the company to report payment history to credit bureaus. They’ve also partnered with Ally Bank to offer longer-term financing options, proving again that flexibility in payment options may be a key driving factor in growth.
• Splitit – Headquartered in New York, Splitit is unique in the BNPL space in that it actually allows consumers to leverage their existing credit. By using their own credit or debit cards with its installment program, customers will see installment charges on their bills, effectively evening out cashflows. The ability to break down payments into smaller pieces without additional interest, applications or fees and build credit at the same time makes Splitit an attractive option for consumers, while being a safe option for merchants. In 2023, Splitit expanded its reach into the Asian market by partnering with Alipay to offer the eCommerce’s clients an installments option.
• Twisto – Featuring a different ‘twist’ on BNPL, European company Twisto offers a monthly credit limit for your payments once you register with them. Shop online or in stores up to this set amount each month and then receive your invoice. Once invoiced, you can settle the full amount with Twisto or pay 10% and defer the rest to a later date. Twisto also offers return options and varying monthly plans, with features like personal finance management and family travel insurance.
• Tymit – Different than the typical pay-in-four installment plans many BNPL providers offer, Tymit’s credit card allows you to select varying installment plans as you make your purchase – including repaying over 3 months with no interest, or even longer (up to 36 months) with transparent pricing quoted upfront. Tymit also offers Tymit Booster, a top-up credit card that allows you to build your credit score and still offers 0% interest on all purchases.

• Fly Now Pay Later – The UK’s Fly Now Pay Later has expanded into the travel-starved US market, while  increasing operations in the UK and Germany. With a mission to make travel affordable and flexible, the company is capitalizing on post-pandemic recovery by offering travel payment plans that work for everyone – destinations and customers. With an easy-to-use booking app, Fly Now Pay Later pays for your holiday with your selected travel provider, leaving you to pay them back with flexible payment options over time.
• Uplift – Headquartered in California, Uplift’s mission is to help people purchase what matters most – in their case, travel. With international partners ranging from cruise lines and resorts to airlines and vacation package dealers Uplift hopes their buy now, pay later plans will “be the economic kickstarter needed to ignite the travel industry.” Uplift works directly with merchants to reinforce brand loyalty, offering customers a simpler way to pay for travel by selecting Uplift options at checkout, without driving consumers to their own proprietary marketplace. BNPL moves into the travel industry have their aim set on future travelers, as two-thirds of Generation Z and millennial would be more likely to take vacations if offered installment options.

These trends are only the beginning of a new, sustainable Buy Now, Pay Later. With a strong credit risk decisioning foundation, you can follow any trend without having to compromise your risk appetite. If you’re ready to rethink your BNPL technology, fortify your strategy, and pivot to profitability, explore the ebook, The Pivot to Profitability: Evolving with Buy Now, Pay Later.