According to reports, with the rise of the Buy First Pay Later (BNPL) service and the heating up of market competition, PayPal announced today that it will no longer charge late fees to Buy First Pay Later users. PayPal said the policy will take effect in the United States, the United Kingdom and France from October this year. At present, PayPal’s buy first, pay later service in Germany and Australia has been exempted from late payment fees.
Last year, PayPal first began to provide buy before pay service. PayPal said today that it hopes these changes will help make its products more affordable and attractive to consumers. Greg Lisiewski, vice president of global payment products at PayPal, said in an interview: We feel late fees hinder the customer experience.
At this time, PayPal announced the abolition of the buy first, pay later late fee, at a time when more regulators around the world are paying close attention to this fast-growing business to ensure that consumers will not bear too much debt. When asked whether “abolishing late fees will encourage more consumers to default on loans,” Liszewski believed that this would not happen.
Buy first, pay later allows consumers to pay in installments when shopping. As more and more people turn to online shopping, buy first, pay later has flourished during the epidemic. With the explosive growth of the industry, market competition has also begun to intensify.
Earlier this month, Twitter CEO Jack Dorsey’s digital payment company Square announced the acquisition of the Australian Buy Now Pay Later company Afterpay in a $29 billion all-stock transaction, signifying the rise of Buy First Pay Later services.
In addition, Apple also began hiring employees with buy first, pay later experience for its payment department earlier this year, with a view to expanding Apple Pay and its wallet applications. It was also reported last month that Apple is cooperating with Goldman Sachs to develop an Apple Pay Later installment payment service.