They want gratification now, even if they can’t afford to pay now. This is especially true as the holiday season approaches.
Holiday shopping can easily put the squeeze on one’s wallet. To help shoppers keep spending to their hearts content, many retailers have brought back layaway or deferred interest financing. Following suit, Paypal recently announced that it is now offering a “Bill Me Later” option to small- and medium-sized businesses.This will now give customers the ability to buy now and pay later for any purchase above $99.
After credit approval the customer will have six months of no-interest financing (if they pay off the balance within that time frame). If the customer doesn’t pay off their balance within six months the Annual Percentage Rate is 19.99%. This is an excellent deal for small businesses as well as they’ll get paid right away without any additional cost or credit risks.
Businesses that took part in the pilot over the last month seem to be impressed.
“It’s very easy to set up and install,” says Nick Capinsk, a direct marketer of tools. “I had the first [banner] up in the website literally in under five minutes.” CEO David Kidd says so far it has resulted in a handful of sales.
He chose Bill Me Later after being rejected by banks, as is offended the case with small businesses. “We didn’t fit into any of the buckets that their underwriters looked at,” he says. There doesn’t appear to be any risks to trying it out, effectively making it a perfect solution (especially for Paypal who’s sure to sure to gain more business and consumer customers).