Visa recently announced a program it hopes will make it simpler for online merchants that want to offer Buy Now, Pay Later capability to choose a technology provider. Visa Ready for BNPL is essentially a matchmaking service pairing merchants that accept Visa with vetted BNPL providers.
Several recent reports have confirmed the popularity of BNPL and charted its growth—especially with the Covid-driven surge in e-commerce and consumers looking for more alternatives to make online payments. A Moody’s analysis noted BNPL’s growth is being driven by the value it provides to both merchants in the form of incremental sales and consumers with the additional purchasing power it provides.
The Visa Ready program for BNPL currently has 27 Visa partners a merchant can choose from to provide BNPL capability. Most of those providers are familiar payment processors like ACI Worldwide, FIS and TSYS that have long histories of working with issuing banks. You won’t find many of the more familiar pioneers in BNPL like Affirm, Afterpay or Klarna on visa’s partner list (though SplitIt, which is a Visa Ready BNPL partner, was an early entrant in the space). That may change, however—Visa continues to add partners.
Fraud continues to be an issue for BNPL providers and merchants offering the payment method. A recent report from data aggregator and credit bureau Experian predicted that 2022 would see a sharp rise in fraud targeting BNPL transactions, especially identity theft and synthetic identity fraud.