Buy now pay later companies
Credit: Incharge

The term “buy now, pay later” (BNPL) refers to a type of short-term financing that lets customers buy goods and services right away and then pay for them over time. Buy now, pay later (BNPL) financing alternatives can help some consumers finance their purchases by breaking them down into smaller parts that are payable over a short period of time while making money for the owners. With BNPL, you can make it easy for your customers to pay you while still getting paid in full right away. But with so many options out there, it may be difficult to make a choice. This article will expose the list of the biggest buy now pay later companies in the USA and how they make their money. 

How Companies That Let You Buy Now and Pay Later Work

Buy now, pay later (BNPL) programs have different terms and conditions, but most of the time they offer short-term loans with fixed rates and no interest. But how do you get to use them? Well, one way is to use a BNPL app, and another is to use a credit card with BNPL features.

If a store accepts BNPL, you’ll be able to “buy now, pay later” when you buy a product. After approval, a small down payment is made, usually between 20% and 25% of the price of the item. Over a period of time, the remaining balance is paid off in a series of interest-free payments.

Automatic charges can be made to your bank account, credit card, or debit card. Even though the CFPB says that most BNPL lenders only offer autopay as a payment option, some may still accept payments by check or bank transfer.

Credit cards usually charge interest on balances that carry over from one billing cycle to the next, but BNPL doesn’t. Some credit cards may offer introductory rates of 0% APR, but this rate may only be available for a short time. You can use the credit you have on your card or buy things with it without having to worry about paying it back right away.

Most BNPL applications don’t have any fees or interest, and the time it takes to pay back the loan is set. Each payment will be the same amount, which you will know ahead of time.

Buy Now Pay Later Companies: History

In September 2022, the CFPB said that the number of BNPL loans made in the US by the five lenders it looked at went from 16.8 million in 2019 to 180 million in 2021. Before, this type of financing was mostly used for cosmetics and clothes. Now, it’s also used for vacations, pets, groceries, and gas, among other things. The average amount of a BNPL loan is between $50 and $1,000.

Some companies, like Affirm and Klarna, let people buy things at retail partners now and pay for them later. One, a company that Walmart owns most of, has said that it will start financing BNPLs in 2023. There are many credit card companies with similar financing plans. JPMorgan and American Express are just two of them.

In March 2023, the CFPB released another report that found that people who use BNPL financing often are more financially vulnerable than those who don’t. This is because people who use BNPL financing often are more likely to have bank overdrafts, payday loans, pawn loans, and other high-interest financial products.

The Consumer Financial Protection Bureau found that people with household incomes between $20,000 and $50,000 are most likely to use BNPL financing. People of color, especially Black and Hispanic consumers, and women are also more likely to use BNPL financing.

You can use BNPL to buy things you wouldn’t be able to buy otherwise, but be careful not to take on more debt than you can comfortably pay off. Your credit score may go down because of this.

Businesses That Let You Buy Now and Pay Later Have Pros and Cons

We’ll talk about the pros and cons of using a “buy now, pay later” service below.


  • The ability to pay for things over a longer period of time.
  • Most of the time, the interest is free or much lower than what you would pay on a credit card.
  • Not having good credit or a high credit score is not a requirement.
  • Rapid consent.


  • It’s not always easy to keep track of payments.
  • If a payment is missed or made late, the borrower may have to pay late fees, and their credit score may go down.
  • There is no way to get cash back or other rewards for shopping.
  • Even though you returned the item, you might still have to pay for it.

Buy Now Pay Later Companies USA

The following is a list of companies in USA that let you buy something now and pay for it later;

#1. Afterpay

Twenty million people use Afterpay, which is also called Clearpay in the UK and EU, to pay for things in four interest-free biweekly or three interest-free monthly payments. Afterpay is a way to pay people in many countries.

Afterpay is the market leader in the “buy now, pay later” space because it offers a convenient one-stop solution for both in-store and online purchases, rewards customers for spending wisely, and sets clear spending limits for new customers that may go up over time.

#2. Affirm

Because of Affirm, both shopping and personal finance have changed a lot. Because they use predictive technology, they can set up payment plans that are different for each customer. For example, for the first four payments every two weeks, there is no interest, but after that, you have to pay 36 monthly payments.

Affirm has a network of over 235K shops and serves more than 31 million customers in the US. After making an immediate purchase, a customer can make easy monthly payments for a long time. Affirm’s clear terms (no fees, no interest that adds up) make customers happier, which can increase conversion rates and lead to more transactions from the same customer.

List of Buy Now Pay Later Companies

Businesses in this field make and keep up an app-based payment system that can be used in stores and online. In many ways, the way BNPL works is a lot like how credit cards work: With the app, a customer can pay for goods and services right away, but the cost can be spread out over a certain amount of time. The following is a list of companies that let you “buy now and pay later”;

#1. Sezzle

Sezzle has had 3.4 million users and 46,000 retailers since it started in 2016. Since it is a certified B company, which is a type of non-profit, clients can put off payments for up to two weeks.

#2. Klarna

Klarna is widely known as one of the best BNPL companies. In 2005, students at the Stockholm School of Economics started the company. Since then, it has grown faster than any of its competitors and is now present in more markets than any of them. Also, Klarna gives buyers more options for how and when to pay for their purchases because it accepts the most payment methods. Klarna operates in 45 countries and serves more than 150 million consumers and 450 thousand businesses.

#3. Splitit

Splitit is a challenger in the BNPL industry that has been around since 2012. However, Splitit is different from other BNPL companies because it charges the full purchase price in installments using the customer’s existing credit card.

#4. Zip

The Australian BNPL company Zip, which used to be called Quadpay, began in 2013 with a simple idea: let customers buy things right away and pay for them in four equal, interest-free payments. Zip is unique among BNPL firms because customers can use it to buy things both online and in stores.

How Do Buy Now Pay Later Companies Make Money

Pay later, get it now. Fees paid by users and businesses are the main way that services make money. Depending on the service provider, a business may have to pay a one-time setup fee or a flat rate for each transaction. Most of the service charges a client has to pay come from interest or penalties for late or no payment.

A company that lets customers buy now and pay later usually charges merchants a percentage fee for payment processing. BNPL enterprises also tell merchants that their sales will increase because they buy previously unattainable items. Many companies that let you buy now and pay later provide interest- and fee-based lending options in addition to their “pay in 30 days” plan.

Getting in touch with retailers who pay a small commission on sales made through their online or physical stores is a common way to make money. PayBright does not charge a fee to sign up, an annual fee, or a late fee. Interest-bearing payment plans are made clear up front, and items that add interest to a balance after the fact are strongly discouraged. The main ways that buy now pay later companies to make money in the USA are:

#1. Revenue From Sellers

Sellers must pay a transaction charge for BNPL, just like they do with credit/debit cards, wallets, and cash on delivery. The typical credit card discount rate is 2.9% for online transactions and 1% less for in-store purchases, thus a 2%-8% rate is higher.

So, BNPL businesses must place their service offerings in a way that convinces potential customers of the service’s value. This encourages more suppliers to join the BNPL service and brings in more customers.

#2. Customers Bring in Money

Most BNPL lenders merely undertake minor credit checks to prevent lending to past late payers. However, this isn’t always the case. This is also part of the list of how to buy now pay later companies to make their money.

Biggest Buy Now Pay Later Companies

The following is the list of the biggest companies in the industry of “buy now, pay later”:

#1. Monzo

Monzo Bank Ltd., which was founded in 2015 and is based in the UK, was one of the first challenger banks to use mobile apps. Also, Monzo is often called a “unicorn” in the banking world. Monzo, which already has 5.8 million customers, is on a certain growth path.

#2. LatitudePay

LatitudePay is a part of Latitude, which is one of the biggest digital payment, installment, and lending companies in the world. The company’s main goal is to help businesses grow and help people manage their own money. Latitude serves about 2.6 million people in Australia and New Zealand.

Why Are Services That Let You Buy Now and Pay Later Important?

Every business needs a straightforward way to buy, but online stores that wish to develop need it even more. Consumers want easy-to-use payment methods that they can change to fit their needs. Payment options like “buy now, pay later” give your customers more freedom and convenience, and they can also help cut down on fraud while increasing sales and AOV. By giving your customers the option to pay later, you can:

#1. Bring In More Sales

Customers are more likely to buy something big if they know they can pay for it over time. It’s easier to commit to four $50 payments with no interest than it is to buy something for $200 on a credit card with interest that keeps going up. This is why services that let you buy now and pay later are so helpful.

#2. Increase the Value of Your Typical Purchase

Services that allow you buy now and pay later make pricey purchases easy. Customers may buy more from cheaper companies if they can spread their purchases over numerous payment cycles.

What Is a Bnpl Company?

A form of short-term financing that enables a customer to make an immediate purchase and spread out the payments for that purchase over time without going through a traditional creditor.

Who Is the Biggest Bnpl Company?

There are;

  • Hoolah/ShopBack PayLater.
  • Openpay Group Ltd (ASX: OPY.AX).
  • Zip Co Limited (ASX: ZIP.AX).
  • LatitudePay.
  • Monzo.
  • Affirm Holdings, Inc.

Is PayPal a Bnpl?

You can now give your customers even more ways to pay by adding Pay Monthly, the newest service from Pay Later. All with the confidence that comes with using PayPal, the most recognized name in online payments worldwide and the industry leader among buy now, pay later (BNPL) service providers.

What Banks Offer Bnpl?

Existing companies like American Express, Chase, and Citi also offer BNPL, but their customers have a different experience than the one that has helped companies like Affirm and Klarna grow so quickly.

Does Amazon Pay Bnpl?

With BNPL, also known as Amazon Monthly Payments, customers can pay for certain items they buy on Amazon over the course of five monthly payments. You can “buy now, pay later” with Amazon Monthly Payment (BNPL). You can choose a separate BNPL service if your product doesn’t support BNPL or if it doesn’t meet your payment needs.

Is Apple Pay a Bnpl?

This feature is Apple’s version of a buy now, pay later (BNPL) service. It lets you buy something with Apple Pay and pay for it in four interest-free installments. 


You may be more likely to encounter BNPL as a method of payment now than you were in the early 2000s. When prices and interest rates are going up, BNPL may be a good choice for consumers. Even though BNPL financing can be helpful, it’s important to know what could go wrong if you decide to use it. With low-interest rates, no fees, and high credit limits, the BNPL apps are easy to use, and people can get the money they need to do most everyday things.


Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like