The two largest credit card companies in the world are making strides into the buy-now, pay-later (BNPL) space with Mastercard Installments and Visa Installments set to be made available to retailers in the coming months.
Mastercard is teaming up with Qantas Loyalty and Australian fintech Latitude Pay as early partners.
Latitude general manager for customer and product, Ethan Sun said, “Retailers will benefit from an easier checkout process, while still offering customers the advantage of Latitude’s instalments features.
Mastercard notes that for merchants, “Mastercard Installments provides seamless merchant integration with a streamlined process for millions of merchants who already accept Mastercard. Meanwhile, acquiring banks can offer installments capabilities to their entire merchant base with minimal, simple integration.”
Visa will be launching its Instalments program in Australia through a partnership with big-four bank ANZ and fintech Quest Payment Systems.
ANZ customers with Visa cards will have access to BNPL on any purchases made that taps into their existing line of credit with the bank. It does not allow users to ‘double dip’ on the card but just changes the repayment structure.
For retailers offering BNPL, that will be handled through Quest.
Visa group country manager for Australia, New Zealand, and South Pacific, Julian Potter tells RetailBiz “Quest provides POS and software, so partnering with them as a first cab off the rank, we anticipate they could get it to the market early in the new year.
“They will approach their merchants in the marketplace, across home improvement, chemists and electronic entertainment.
“They will ask the merchant if they want to participate, and they can choose to sign up, or not sign up for it.
“Our research suggests that instalment plans have been good for retailers. There’s evidence that the ticket size is bigger with predictability on repayment.
“There’s a good win-win, and merchants can opt in based on whether they see a benefit for their business.”
Quest head of SME and alternative payments, Luke Fuller said, “Quest is delighted to be working closely with Visa to offer instalment payments through our family of trusted payment terminals, already used by many of Australia’s best known retail brands. In making this available through our omnichannel payment gateway solutions, retailers will be able to offer instalment payment options to their customers both online and in-store.”