• Superbalist recently began offering PayJustNow’s BNPL offering.
• The retailer says this has improved checkout completion and 20 percent of new shoppers using the offer.
• PayJustNow allows customers to pay for an item over three interest free installments.

Buy Now Pay Later (BNPL) is a way that shoppers can get an item now and pay it off over a few months or weeks. The offer is attractive because in most BNPL solutions, interest isn’t charged and the term of the repayment is far shorter than a loan.

This method of payment is gaining traction in South Africa especially among online retailers such as Superbalist which recently began offering BNPL through PayJustNow.

“Since adding PayJustNow, we’ve seen an increase in our checkout completion rate. This solution has also afforded our customers greater freedom and more spending power” says Grant Paul Roy, Superbalist’s chief product and marketing officer.

“We’ve also seen excellent customer acquisitions with 20% of our first-time buyers making use of PayJustNow as a BNPL solution. We’re very happy with the performance of this partnership.”

As regards PayJustNow, customers can pay off the cost of an item in three equal, interest-free instalments.

Usually BNPL is reserved for big ticket items like appliances and electronics. The fact that we’re seeing this solution entering the realm of fashion and clothing – a seasonal purchase for most – is really just an evolution of store accounts.

However, as short-term loan provider Wonga warns, BNPL isn’t covered under the National Credit Act and as such, customers aren’t afforded the protections that law offers.

“As a result, missing an instalment or repayment on a BNPL purchase may come with excessive fees or costs,” the loan provider warns.

PayJustNow says these late fees will never be more than 25 percent of the value of the transaction which is rather steep as regards late fees.

“Selecting BNPL can also be an easy way to overspend, considering that common repayment terms do not typically align to a monthly salary cycle – meaning that your final instalments may fall due before your next monthly source of income has arrived. This can place pressure on your budget and monthly cash flow, and may lead you to overspend over what you originally intended to during a month,” adds Wonga.

PayJustNow says it vets its customers which includes conducting credit checks so it does seem to be operating within the boundaries of the National Credit Act.

Just remember that eventually all bills come due and you should never take on more debt than you can afford. No outfit is worth going into debt for folks.