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Which is the best Buy Now Pay Later option for you?

By May 15, 2020July 25th, 2023No Comments

The relatively new trend to hit Australia of Buy Now Pay Later (BNPL) payment options is often confusing with the range of options expanding monthly. These payment options allow both the customer and business owner to receive their goods and payments immediately. Over 2 million Australians used BNPL platforms in 2019, with over 50% being in the 18-34 age bracket.

The BNPL revolution  is becoming more of a requirement than a strategic choice, with the platforms providing a range of pros and cons for both businesses and websites and offering a range of attractive terms to customers. Making the checkout process easy, with multiple payment options, especially on mobile, is a key to successful online trading.

Below is an overview of the top four BNPL platforms in Australia: Afterpay, Zip, Klarna and Splitit.

The key benefits of BNPL include:

  • Acquisition of  new customers to your website
  • Retaining  existing customers who see value in BNPL
  • Increased average order value and frequency
  • Potential to access global markets through the platform
  • Access a new segment of potential customers


Afterpay is a platform that lets the consumer purchase a product now and pay for it later, usually in four equal payment instalments. These instalments are paid fortnightly over 8 weeks, with no upfront or ongoing fees. Minor late penalties do apply however,  if payments are not made according to schedule. Afterpay has become a millennium icon, but it will cost you, charging a percentage on sales made through the platform. The sign-up process is seamless and can be done online as well as in participating merchant stores.


Zip has 2 platforms that are designed for different transaction amounts. The first, ZipPay, essentially serves the same function as Afterpay with the key difference being the  freedom to choose when you pay (such as daily, weekly, or monthly)whereas Afterpay’s payment plans are more structured.. The minimum monthly payment is $40, which can be of great benefit to your customers. ZipPay is arguably more akin to a digital wallet, with a monthly fee of $6 which is only activated if there are payments to be made. Zip’s brand has also increased exponentially within Australia and is growing throughout the world.

Zip’s second platform,ZipMoney, can be more closely compared to a credit facility but for transactions over $1000 This offers a great innovative payment scheme for customers purchasing products over $1000, as well as a great opportunity to generate higher sales. Dealing with larger sums of money, a credit check is usually required on sign up. It also has an establishment fee of $0-$99 and can attract interest after 3 months.


Swedish player Klarna is the most recent BNPL platform to enter the Australian scene. Klarna’s platform allows customers to enjoy a suite of payment options including the ability to pay off the purchase in full in 30 days with no fees. Furthermore, there is a full-scale financing option that includes interest but can be attractive for those looking to pay for a product over a long period of time. Finally, they offer the standard instalment scheme, paying off a product with 4 interest free payments. Klarna has the largest European presence out of the BNPL players, which makes it the most attractive option for those businesses selling  products in Europe.


Splitit is also a relatively new player to the Australian BNPL market. Splitit’s key point of differentiation is that consumers are able to make the purchase through their debit or credit card. This means the consumer does not need to be approved for a line of credit – having already been verified. The instalments are also interest free and there are no direct associated costs. However, if a consumer does not have sufficient funds in their card at the time of an instalment, the account will be overdrawn and the consumer subjected to their own card’s associated fees.

Other platforms worth reading about include Openpay, Humm, Sezzle, Brighte, Latitude Pay, Bundll, Laybuy and Payright.


The BNPL wave has become too big to ignore as a merchant in Australia. In order to ride this wave, understanding the payment options and how they relate to your business and customers is of key importance. Customers are drawn to options which make the purchase process easier, especially on mobiles. The research suggests that the merchants who learn how to master the BNPL offering for their business, are the ones to  reap the rewards.

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