Barclays, Amount add installment loans
Barclays US, which offers a range of co-branded credit cards targeting middle-income consumers, is adding a buy-now / pay-later option for its merchant partners.
Working with Chicago-based fintech Amount, Barclays plans to develop a white-label POS installment loan tool in the coming months to complement its existing co-branded and private credit cards, the companies said on Tuesday.
“The buy now, pay later trend is very strong and growing, and it complements credit cards where people are looking to fund a specific purchase through installment payments,” said Denny Nealon, CEO of Barclays US Consumer Bank , in an interview.
The BNPL option application is most popular with younger consumers, but it covers all age groups, according to Nealon.
“As we saw during the e-commerce boom during the pandemic, consumers continue to spend with credit cards. But especially in travel, there are a lot of use cases where people want different, more flexible payment terms for a specific purchase, ”Nealon said.
Barclays and Amount will design a personalized approach for each trader adding BNPL.
“It will match the lifestyles and buying habits of consumers to create and reward loyalty more than just providing a new channel for transactional income,” said Nealon.
Barclays has not disclosed which of its co-branded credit card customers would be interested in adding BNPL offers through Amount. Barclays credit card partners include American Airlines, JetBlue, Wyndham, Choice Hotels and many more.
Amount creates an approach in which Barclays credit card customers can seamlessly extend BNPL loans at checkout alongside branded and private label cards, without requiring applicants to leave participating merchant sites, said Nealon.
It is too early to discuss the terms and fees for Barclays’ BNPL programs, which the bank is still developing, he said.
Amount, a spin-off of Chicago-based loan company Avant, specializes in white-label digital banking and lending solutions and has worked with Regions Bank and Banco Popular on BNPL programs, said Adam Hughes, CEO of Amount.
“Banks look to us for personalized and private label BNPL services, which are the fastest growing part of our business right now,” said Hughes, noting that one of the calls is to keep customers on the website of the merchant or the bank through the BNPL. application and approval process, instead of being directed to a third-party site.
“There is a higher rate of trust and follow-up when consumers stay on the original website throughout the installment loan application process,” said Hughes.
Many merchants support third-party BNPL options alongside trademark and private label cards.
Barclays recently signed a long-term agreement for manage all co-branded and private label credit cards for The Gap from May 2022. The deal covers The Gap, Old Navy, Banana Republic and Athleta cards.
The Gap in November 2020announced a partnership with Afterpayand PayPal for point-of-sale installment loans.
Barclays last month launched a new Mastercard branded AARP credit card, replacing the old AARP co-branded Visa card with Chase. Barclays AARP Essential Rewards Mastercard has no annual fee and offers users $ 100 cash back if they spend $ 500 in the first 90 days. The card offers 3% cash back on purchases at gas stations and drugstores (minus Target and Walmart) and 1% elsewhere.