Dive Brief:
- Beginning on Wednesday, buy now, pay later player Zip started giving its U.S. customers the chance to pay in two installments rather than the traditional four. The company is one of the first BNPL firms to offer this option.
- Consumers who choose to pay twice will pay half the bill with the initial purchase and the second half two weeks later, the company said Wednesday in a news release.
- Zip expects consumers will use this new option to buy daily essentials, CEO Joe Heck said in the news release.
Dive Insight:
The Australian company surveyed customers after a pilot of the pay-in-two service last year, Heck said.
"Notably, 95% of surveyed participants said they would use the pay-in-two option again, with future use centered on everyday needs like groceries and bills," Heck said.
The two-payment option became available to all Zip users in the U.S. on Wednesday, a Zip spokesperson said in an email.
The spokesperson declined to provide more details about the pilot and the survey.
Zip has a U.S. headquarters in New York City, and some of it’s well-known merchant partners include Target, Barnes & Noble, Home Depot and Best Buy.
The buy now, pay later industry's most well-known product is the pay-in-four installments option, which lets shoppers split a purchase into four interest-free installments paid out over several weeks.
Most BNPL companies now offer longer-term loans, some of which are interest-bearing.
Competitor Affirm is also innovating, with plans to begin offering its services to renters and will give them the option of splitting rent payments into two installments.
