“The significant growth in contract volume and statistical figures confirm that people in Estonia have adopted these highly popular payment solutions, which have been widely used worldwide for some time, and are increasingly using them to spread out their expenses,” said Birgit Listmann, Head of Partner Channel at Inbank. In the first nine months of this year, the volume of “buy now, pay later” payment methods has grown by 3.1 times (+211%) and the number of contracts by 3.4 times (+239%) compared to the previous year.
According to Listmann, in addition to the wide availability of the payment solution, growth has also been driven by Inbank’s partnership with the banking payment provider Montonio, which has helped increase the number of merchants offering “buy now, pay later” solutions. Inbank’s payment solutions are also available through Maksekeskus and Paysera, and this year, a collaboration was launched with one of Estonia’s largest online stores, Kaup24.ee, for “buy now, pay later” solutions.
“For consumers, the appeal of such payment solutions lies in the ability to spread payments over a few months—for instance, allowing them to pay for a purchase in three installments without additional fees. It’s a flexible financing option for both unexpected expenses and planned purchases,” added Listmann. Compared to installments, this payment method has an advantage, as it doesn’t incur extra costs or interest for the consumer—for example, a 300-euro purchase can be paid in three installments of 100 euros each over three months.
Offering payment solutions increases the conversion rate
“For merchants, offering a payment solution primarily means a higher purchase conversion rate. By providing such solutions, merchants can make products more accessible to customers, increasing both the number of products sold and the value of the shopping cart. For example, a consumer can order several items of clothing from an online store, try them on, return those that don’t fit, and only pay for what they actually liked—otherwise, it feels like a prepayment when the goods haven’t yet been received, but the money is held in the account,” explained an Inbank expert.
He emphasized that while this is an extremely convenient solution for consumers, each purchase and use of a payment solution carries obligations, so consumers should carefully consider each purchase decision. “The average shopping cart amount for the ‘buy now, pay later’ payment method is around 551 euros, meaning that customers with short-term delays are few, and the delayed amounts are not large,” Listmann noted.
