Move over Afterpay: Visa announce new instalment option for cardholders
Last week, electronic payment giant Visa announced they will release a new Buy Now Pay Later option for their credit card customers.
The pilot program is set to drop for both clients and partners in January 2020 and will give cardholders the option to divide the total amount of a purchase and pay in smaller, equal payments over an agreed period of time.
Existing Visa card users (from participating issuers) will have access to the program and can take full advantage of the new instalment option with participating merchants in store, online and even when travelling overseas.
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“Visa’s instalment capabilities are changing the game by allowing issuers to leverage an existing payment account consumers already have and are familiar with, instead of asking them to submit to a credit check, download an app or open another line of credit,” Senior Vice President, Global Head of Issuer and Consumer Solutions Visa, Sam Shrauger said.
“We expect instalments to become a foundational method of payment at checkout for both domestic and cross-border commerce payment transactions.”
According to Euromonitor, in 2017 instalment options came to a total $1.2 trillion in payment volume worldwide and continues to grow by 15% each year, which is double the growth of credit cards.
What makes Visa’s instalment option different?
As time goes on more and more Buy Now Pay Later options are becoming available, but Visa’s new instalment scheme works a little differently.
Visa say they will simplify the current “friction-filled” and “time-consuming” process for using instalment payment options by cutting out the sign-up and application stages, and allow their existing customers to use a platform that they are already familiar with.
Unlike their other buy now pay later competitors, Visa already have a massive global customer base and their instalment option isn’t an external “add-on” option but instead is available to use directly via a Visa card.
Additionally, it will be one of the first payment innovations to be available through Visa Next, a new online and app-based platform for customers to access any fresh solutions offered on Visa’s products, as well as manage all their Visa banking and digital wallets in the same place.
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