PayPal Holding Inc. (NASDAQ:PYPL) is taking on rivals such as Klarna, Afterpay, and others in the UK with the launch of a buy now, pay later service called “Pay in 3” ahead of the winter shopping season.
Customers to pay in three monthly installments
The new service lets businesses offer customers the alternative of buying products between £45 and £2,000 and then pay in three monthly installments, interest-free with automated monthly repayments. PayPal, which is popular for its payment tools, has been foraying out into credit for years since it acquired Bill Me Later. Pay in 3 has been integrated into the PayPal wallet, which will allow customers to manage payments online or through the PayPal app. The launch of “Pay in 3” in the UK comes at the back of the company launching a similar product, “Pay in 4” in the US last month.
Rob Harper, UK’s PayPal director of enterprise accounts said that the number of people shopping online in the UK has increased dramatically over the pandemic period. He said that customers are seeking ways of spreading the costs of the purchases and as a result, PayPal is launching “Pay in 3” to address that need. Harper said that they are building on their culture as a responsible lender via PayPal Credit, which launched in 2014 in the UK.
PayPal looking to leverage winter shopping with new service
The launch of “Pay in 3” seeks to leverage the upcoming winter shopping, including Black Friday and Christmas. Harper said that they are also looking to take advantage of the growing buy now, pay later trend in the market dominated by the likes of Klarna, and now smaller brands are also foraying onto the market that is not as popular as PayPal.
PayPal expects its brand recognition to give it’s a competitive edge over rivals, considering it has increased YoY customer accounts by 300% in Q2. Currently, the company enjoys over 24 million active customers in the UK, surpassing the likes of Klarna, with only 10 million customers.