Several vendors (online and physical) have started providing flexible financing and monthly installment payment plans via third-party 'purchase now, pay later' apps such as Klarna, Affirm, and Afterpay.
Klarna is a modern 'buy now, pay later' solution founded in 2005 in Sweden. Presently, it is available in almost 20 countries adding up to over 90 million customers. Using the Klarna mobile app, you can acquire a small loan at the checkout for online and in-store purchases.
If you want to purchase large ticket items on loan with no interest, then Klarna is the solution for you! Klarna partners with well-known retailers such as Apple, Macy's, Etsy, Foot Locker, and Sephora, giving you the chance to make low-interest payments on large purchases.
This article will look at how Klarna’s flexible payment can boost your business’ growth in the most innovative and profitable ways.
1. Bigger single purchases
People usually don't make the big purchases they want because they can't afford to pay the full amount upfront. Chances are, if you tell a customer they can pay in installments, they will jump at the opportunity. Why? It's less overwhelming and guilt-free. It’s easier to convince a buyer to pay $50 every two or three weeks than $700 upfront.
Klarna’s payment plan includes Pay Now, Pay in 4, Pay in 30 days, and the best part? The vendor gets the total amount up front! So, there are no chances of getting scammed by a buyer. So, enjoy the benefits and none of the risks.
2. Less cart abandonment
We have all experienced this before. You go online window shopping, fill your cart, and the checkout total completely discourages or intimidates you at the end. As a result, you may get frustrated and abandon the entire process instead of reducing your cart to fit your budget. With Klarna, this does not have to be a concern for buyers or merchants.
Buyers can fill up their carts and check them out by choosing the most convenient payment plan offered by Klarna.
3. Zero-interest rates
I'm pretty sure you have taken out a loan at some point in your life. Maybe from your local bank, a friend, a loan shark or running up your credit card debt. The problem with these options is that while they might seem like good and quick ways to get money, they usually come with hefty interest rates, whether hidden or transparent.
This is why people hold out on making big purchases, even if they can take out a loan or overcharge their credit cards. With Klarna, this is not a concern. All your future payments are interest-free, so paying upfront basically comes up to the same amount as paying in installments.
PS: Klarna charges a late fee only if two attempted payments are unsuccessful.
4. Klarna is not just a flexible payment method
At some point, once vendors have well-established websites, apps or storefronts, they create rewards programs to boost sales. However, managing a rewards program often requires more time and marketing dollars, which a small business may not have.
This is why Klarna is the best tool for small business owners because they may not have the funds for a fully functional rewards program. Klarna has an in-built rewards program that rewards your customers for every dollar they spend.
Consumers appreciate rewards programs because they feel more valued, incentivizing them to purchase goods more often. Given that repeat customers spend approximately 67 percent more than first-time buyers, there is a hidden opportunity for sales growth.
57 percent will actively engage with a rewards program because they enjoy getting extra items and discounted rates when they shop, and 37 percent will join to earn points for future purchases.
5. Klarna- ‘Everywhere you go.’
Klarna is not limited to one payment channel. So, whether your clients are at your physical store, on a market day, or on your website or app, they can conveniently and smoothly checkout and pay using Klarna.
6. It doesn’t have many requirements for one to qualify
Many of us know how hard it can be to qualify for credit or even get a credit card. It is much simpler to qualify for a credit card with a Klarna than with a bank. Of course, the company takes your credit score into account, along with other factors, but no minimum score is no minimum score is required.
Sales are higher because anyone can qualify for credit or a card. Even if the buyer cannot be trusted to pay and pay on time, this risk is fully taken by Klarna. As a vendor, your job is to enjoy the profits from impulse and large purchases.
7. Credit cards are a thing of the past
According to recent research, between 23 and 49.7 percent of millennials and Gen-Zers do not have a credit card but prefer debit cards. For younger consumers, BNPL options such as Pay in 4 offer all the wiggle room of a credit card without the anxiety of excessive debt and with no interest payments.
8. Unlimited access to a whole new audience and market
Even when you join Klarna with your clientele and target market, you have unlimited access to their users that you can turn into paying and loyal customers. The Klarna app has over 6 million monthly active users eager to explore and shop instantly from your store. With their convenient mobile app, shop directory, and marketing channels, you are guaranteed a steady stream of new customers.
If you are starting, this tool is even more handy for you because you don't have to spend hundreds of dollars advertising on different platforms to increase brand recognition. Vendors who partner with Klarna enjoy an average increase of over 30% in conversion rates, hence higher profit margins.
As you can see, there is no reason why your business shouldn’t embrace a safe, affordable and handy flexible payment solution like Klarna. Shoplazza is one of the eCommerce platforms that has embraced this easy ‘buy now, pay later’ solution! Open your Shoplazza business account today and your products could be ready for purchase and shipping in minutes!