Buy Now, Pay Later: How the Right Payment Method Increases the Willingness to Buy in B2B and B2C [5 Reading Tips]

20 per cent of all online orders are cancelled if the preferred payment method is not offered. This is true for both B2B and B2C customers. Employees who make purchases for a company want the same payment experience as they do when shopping online in their private lives. Purchasing on account with »buy now, pay later« is becoming increasingly popular. It offers customers financial flexibility and automates the processing of payment transactions for companies.

Buy Now, Pay Later Ensures a Positive Shopping Experience

As the name suggests, »buy now, pay later« (BNPL) gives customers the option of paying for ordered goods at a later date or in instalments – just like conventional purchasing on account, but much less complicated thanks to payment service providers such as Klarna, PayPal and AfterPay. In Germany, 40 per cent of online shoppers have already used this payment method. It helps companies improve their customers’ shopping experience and rewards them with an increased willingness to buy.

Benefits for Companies Offering BNPL

Greater customer loyalty
Higher shopping cart totals
Fewer abandoned sales during checkout
Less effort because billing is outsourced

Buy Now, Pay Later in B2B: Challenges

Purchasing on account is also the most popular payment method among companies and is common practice in offline business. In B2B, quotations are usually individual and the value of shopping carts is higher. As a result, the BNPL payment method is slightly more complex and riskier for vendors in B2B than in B2C. Before B2B customers can opt for the payment method »Purchase on account«, they first have to manually request a credit limit via e-mail or phone and prove their identity and creditworthiness. This enquiry is then processed by the company’s finance department, which may take a few days.

Buy Now, Pay Later in B2B: Benefits

BNPL service providers such as Billie, which focus on B2B, automate this process as much as possible in order to minimise the associated effort on both sides.

Companies that make their purchases using BNPL can plan them well in advance, adjust them to their customers’ incoming payments and pay larger sums in instalments. This way, they remain solvent throughout and can keep an eye on all transactions via the payment service provider’s dashboard.

Merchants offering BNPL as a payment method have been able to increase their revenue by three to ten per cent while more than doubling the average value of shopping carts. Moreover, the payment method protects merchants against payment default. As a full-service solution, dunning and collection services are integrated alongside the processing of conventional payment transactions.

Companies offering BNPL in their online shops not only benefit from satisfied customers, but can also significantly reduce their effort, especially in B2B.