Worldpay and Affirm Team Up to Offer Buy Now, Pay Later
Buy now, pay later provider Affirm and Fidelity National Information Services, better known as FIS, have partnered to make Affirm’s checkout services available to FIS’s Worldpay clients, according to a joint press release from the companies on Wednesday. The multi-year partnership with Worldpay gives San Francisco-based Affirm access to about one million merchants in Worldpay’s global network, according to the release.
Flexible Payment Solutions for Worldpay Merchants
With the new pact, eligible Worldpay merchants will be able to offer Affirm's Adaptive Checkout solution, which allows customers to split their purchases into bi-weekly or monthly payments with no interest or late fees. The service uses an underwriting system to conduct a soft credit check and approve customers for those installment payment options. Integrating Affirm at checkout will enable Worldpay merchants to "capture new sales opportunities and revenue streams, helping them continue to grow into the future," Jim Johnson, head of merchant solutions at FIS, said in the release.
For Affirm, the partnership extends the reach of its products, said Becca Stone, vice president of strategic partnerships at the BNPL company. "Consumers are demanding more flexible and transparent options that enable them to pay over time without any junk fees or hidden charges," Stone added. Affirm's BNPL solution is popular with consumers because it offers a more flexible and transparent way to pay for purchases without affecting their credit score during the initial check.
The Rapid Growth of the BNPL Market
The tie-up comes amid an intensely competitive BNPL environment. Highlighting its growing global significance, Worldpay's data revealed that BNPL made up 5% of global ecommerce transactions in 2022, a share expected to increase in the forthcoming years. Despite facing competition and an evolving regulatory environment, the BNPL market is forecasted to witness a CAGR of 33.3% by 2026, reaching a valuation of USD 596.7 billion. By 2026, BNPL transactions are projected to constitute a significant percentage of ecommerce values in several countries.
Projected BNPL Share of Ecommerce Value by 2026
| Country | Projected Ecommerce Value Share |
|---|---|
| Germany | 25% |
| Netherlands | 14% |
| United States | 7% |
Business Benefits of Buy Now Pay Later
Buy Now Pay Later can be a valuable tool for businesses who are looking to increase sales, improve customer satisfaction, and acquire new customers. Here are some of the specific benefits for businesses:
- Increased sales: Merchants who offer BNPL saw a 30% increase in average order value and a 10% increase in conversion rate.
- Improved customer satisfaction: 80% of BNPL users said they were more likely to shop with a merchant that offers BNPL.
- New customer acquisition: 40% of BNPL users were new to the merchant they were shopping with.
- Reduced cart abandonment: BNPL can help reduce cart abandonment by 40% by giving customers a way to pay even if they don't have the full amount available.
- Improved cash flow: BNPL providers typically pay merchants in full upfront.
- Reduced risk of chargebacks: Strict underwriting criteria from providers help reduce the risk of chargebacks.
The partnership between Worldpay and Affirm is a sign of the growing popularity of BNPL. As more and more consumers look for flexible and transparent ways to pay for their purchases, BNPL is likely to continue to grow in popularity for both consumers and businesses.
