View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
September 14, 2021

Capital One to foray into BNPL space with POS offering

By Shalini mani

Capital One Financial is reportedly preparing to pilot a ‘Buy Now, Pay Later’ (BNPL) product this year, as the market for BNPL services continues to evolve rapidly.

Free Report
img

What does the future hold for BNPL market?

The global Buy Now Pay Later (BNPL) market is estimated at a massive $120 million in 2021 – representing just less than 3% of the global ecommerce market. Yet the user-base is massive, with leading provider, Klarna, alone reportedly having 87 million users in 2021. This market is only expected to grow, with established companies like Apple and Goldman Sachs moving into the BNPL sector in bids to capitalize on this trend. To help you make the most of this growing market, GlobalData’s Buy Now Pay Later in 2022 and Beyond report provides detailed insight into the BNPL sector. This report:
  • Discusses the disruptive potential of the BNPL sector on the payments industry
  • Identifies the leading companies that are driving sector growth and the benefits this new payments solution provides to both merchants and consumers
  • Analyzes the consumer’s risk of using BNPL loans and government attempts at introducing regulations to the sector
  • Uncovers the main risks that consumers expose themselves to when borrowing with BNPL
Download this free report to get to know where this developing market is headed, and how you can reshape your strategies.
by GlobalData
Enter your details here to receive your free Report.

As part of its BNPL entry, the firm is planning to test point-of-sale loans for customers at its existing merchant partners, Reuters reported.

Capital One CEO Richard Fairbank has been quoted by the news agency as saying at a Barclays investor conference: “We will be testing a beta version of our own BNPL product.”

Fairbank added that the company will now use the data from the test to understand the offering better and to analyse how to garner the attention of both merchants and consumers.

“We’re watching this product closely and certainly not taking this growth lightly,” he added.

Fairbank attributes the sudden popularity of the BNPL offerings to support from venture capitalists as well as subsidised interest costs by merchants.

Fairbank further said: “The elephant in the room is the sustainability of the merchant subsidy. This is fuelled by merchants’ beliefs that they’re getting incremental volume.”

The US-based credit card issuer’s latest move comes at a time when the consumer loans segment is facing increasing competition from tech firms, which enables merchants to offer cheap financing options for purchases.

Last year, Reuters reported that Capital One decided to stop its customers from using their credit cards to clear BNPL instalment dues citing risk concerns.

At the time, a spokeswoman for the firm said that the decision does not impact customers who used debit cards or checking accounts for BNPL purchases.

Free Report
img

What does the future hold for BNPL market?

The global Buy Now Pay Later (BNPL) market is estimated at a massive $120 million in 2021 – representing just less than 3% of the global ecommerce market. Yet the user-base is massive, with leading provider, Klarna, alone reportedly having 87 million users in 2021. This market is only expected to grow, with established companies like Apple and Goldman Sachs moving into the BNPL sector in bids to capitalize on this trend. To help you make the most of this growing market, GlobalData’s Buy Now Pay Later in 2022 and Beyond report provides detailed insight into the BNPL sector. This report:
  • Discusses the disruptive potential of the BNPL sector on the payments industry
  • Identifies the leading companies that are driving sector growth and the benefits this new payments solution provides to both merchants and consumers
  • Analyzes the consumer’s risk of using BNPL loans and government attempts at introducing regulations to the sector
  • Uncovers the main risks that consumers expose themselves to when borrowing with BNPL
Download this free report to get to know where this developing market is headed, and how you can reshape your strategies.
by GlobalData
Enter your details here to receive your free Report.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. A weekly roundup of the latest news and analysis, sent every Wednesday.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Electronic Payments International