The Financial Brand Insights - Fall 2022

cost, way to acquire the goods they desire “in the moment.” This is not a moment for credit card issuers to stand idly by. BNPL represents an opportunity to reassert the primary financial role you have worked hard to establish over decades: to be a trusted financial partner and the lender of choice for these purchases. By implementing new digital offerings, you can deliver customer payment journeys that provide cardholders with convenience and security, and elevate your credit card to top-of-wallet status for payment choices.

By Randy Piatt Vice President, Product Solutions & Marketing at Fiserv

Buy now, pay later (BNPL) payment options from nontraditional financial service providers are having an impact on credit card spending and the profitability of credit card programs that rely on revenue from credit lines and interchange. But banks don’t have to passively accept another shift in consumer behavior that chips away at their business. By implementing new digital capabilities for credit cards, financial institutions can compete against BNPL and elevate their card to top-of-wallet status for their consumers’ in- the-moment payment choices. BNPL offers target discretionary consumer spending that was previously the domain of credit cards. According to recent research by Raddon, a Fiserv company, 38% of consumers have used a BNPL option and an additional 23% said they’re likely to do so. For credit card issuers, this potentially means lower transaction volume, and that is a double hit to the bottom line. More BNPL transactions could translate into fewer consumers who roll their monthly balances and deliver fee income, and it would negatively impact interchange income. The consumer attraction to BNPL is easy to understand. It presents a low-cost, or lower-

Top-Of-Wallet: New digital capabilities for credit cards can put bank cards at the top of the consumer’s wallet for in-the-moment purchases.

How Credit Card

Make Your Credit Cards Instantly Available

Buy now, pay later (BNPL) payment options have the potential to drive down profits from bank credit card programs. Banks don’t have to stand by and watch their card revenue slip away. They can compete by implementing new digital capabilities for credit cards that elevate their cards to top-of-wallet status for consumers’ in-the-moment payments. Programs Can Outmaneuver Buy Now, Pay Later

Many consumers are choosing BNPL because it is extended at the time of purchase. An immediate purchase decision demands an immediate payment response. Making credit cards just as easy to use as BNPL provides you with an opportunity for your card to be chosen. To level the playing field and compete successfully, credit cards can be issued digitally and be immediately available for consumers to place in their digital wallets. This quick process will give consumers instantaneous access to a new card and a simple way to use it at checkout. No longer will consumers need to fumble for a physical card, or key-in card details to pay manually. Shaving minutes from the purchase process with a digital card enables consumers to seamlessly accept and close on offers from merchants.

Use of, and likelihood to use, BNPL

All Consumers






23% 16%

Gen X




Baby Boomers








Have used BNPL Have not used BNPL but are at least somewhat likely to do so

Have not used BNPL and are not likely to

THE FINANCIAL BRAND © July 2022 SOURCE: Raddon Research Insights





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