Amazon launches buy now, pay later service in UK

Recently, Amazon has partnered with British bank Barclays to launch a buy now, pay later service in the UK. Using the new payment method, British customers can pay in installments over 3 to 48 months, but the service is only available for orders of 100 pounds and above.

With this payment method, consumers can purchase millions of products on Amazon, including those sold by third-party sellers. However, this payment method is not available for gift cards, digital products, groceries, pre-sale products and out-of-stock products.

Unlike existing buy now, pay later providers such as Klarna, Barclays will charge interest during the instalment period, at an annual rate of 10.9%. Amazon said customers need to meet certain eligibility requirements to apply for an instalment payment account, such as being over 18 and having lived in the UK for at least three years.

The service was launched in Germany last year and has now been expanded to the UK, demonstrating the popularity of buy now, pay later in Europe. In addition to travel restrictions, people’s economic level has also declined and their spending power has decreased under the epidemic, making buy now, pay later increasingly popular in Europe.

Research shows that 36% of Generation Z in the UK used BNPL in 2021, a six-fold increase since 2019. In October this year, 28% of UK adults used this payment method, an increase of 2.6 million from 10 months ago.

A recent survey of 5,000 British consumers showed that 22 % of them will use buy now, pay later to spend their Christmas shopping. Many people believe that this payment method can better manage finances and alleviate the current economic difficulties.

However, "buy now, pay later" has also caused a lot of controversy because it causes consumers to be heavily in debt . Data shows that during the epidemic, British online shoppers have accumulated more than 4.7 billion euros in debt . The UK Advertising Authority has even banned advertisements representing payment provider Klarna .

In addition to Europe, the usage rate of buy now, pay later also increased by 400% during Black Friday in the United States . This payment method is becoming more and more popular among consumers.

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