Citi launches Spot. Buy Now Pay Later
Another bank has announced it’s jumping on board the Buy Now Pay Later (BNPL) train!
Today, Citi Australia revealed that in October 2021 it’ll be launching a brand new BNPL service called ‘Spot. Buy Now Pay Later.’ And pre-registrations are now open.
Traditionally known for its extensive suite of credit card options, Citi says that the service is a separate brand and will be issued by it’s affiliate company, Diners.
“We are excited to enter the buy now pay later market with an offering that will be compelling for customers and merchants,” Head of Cards and Loans at Citi Australia Choong Yu Lum said.
“This is a global first for Citi, and we’re confident that success in the Australian market could lead to a worldwide rollout of the new payment method.”
How does Spot work?
Like other BNPL platforms, Spot allows customers to make a purchase and pay it off in interest-free instalments. The repayments are split into four fortnightly amounts, or for purchases over $200, customers can pay a flat fee of $10 to break down the payments into eight fortnightly instalments.
Applications for the service can be made online or via the Citi app. Once approved, users will have access to a limit of $1,000 and will be able to add the Spot card to their digital wallet to start making purchases. Spot accounts are managed within the Citi app and can be linked to any bank account in the user's name (to make repayments).
But where can you use Spot Buy Now Pay Later?
Mastercard Australia’s vice president of business development, digital and innovation, Surin Fernando says it can be used at any retailer that accepts Mastercard.
And that includes retailers that are local and abroad, as well as online and in-store.
“As consumers and retailers continue to shift their payment preferences and behaviours, providing choice in how to pay and get paid has never been more important,” he said.
“With Spot. Buy Now Pay Later, Citi is taking full advantage of Mastercard’s market-leading payment network and instalment technology to offer its customers more flexibility, while still benefiting from the same widespread acceptance, safety and security they’re used to when paying with their Mastercard card.”
Why Spot over other BNPL platforms?
It all comes down to how the payment system works.
According to 2020 research from Citi, 98% of Aussie credit card users are aware of the major BNPL players, but only 25% of them have actually given them a go.
“How Australians use credit is evolving, and there remains an opportunity for new players to step in and listen to consumers who are sending a clear message they want innovative payment solutions to help them manage their finances,” Lum said.
“Spot. Buy Now Pay Later will stand out in this growing market as a solution for consumers as it solves existing pain points. Spot is not limited to specific merchants but is available anywhere Mastercard is accepted.”
Lum said that while some buy now pay later providers force consumers to link an account from a specific financial institution, Spot will ask consumers to link an account of their choice.
Right now there are over 10 BNPL providers in Australia. To find out more about what services are available right now and compare head to our Buy Now Pay Later hub or the BNPL statistics report.
^See information about the Mozo Experts Choice Buy Now Pay Later Awards
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