Retail

by Swapnil Sharma

April 11, 2024

Streamlining Retail Transactions: Retail POS Integration with BNPL for Enhanced Customer Experience

Today’s customers crave flexibility and control over their finances.

That’s where Buy Now, Pay Later (BNPL) comes in. It lets customers pay for things in smaller chunks instead of all at once.

This makes it easier for them to buy things they want.

For businesses, POS integration with BNPL has a lot of benefits as it can bring in more customers and boost sales.

Let’s look at how BNPL can make a real difference for your business.

How Can BNPL Help Boost Revenue for Your Retail Business?

Retailers can capitalize on the benefits of POS integration with BNPL to drive revenue growth and create a more engaging and satisfying shopping experience for their customers.

Here are several ways it can help.

1. Increased Conversion Rates

When stores offer “buy now, pay later,” more people end up buying things because they can pay in small installments instead of all at once.

This makes it less likely for them to change their minds and leave the website without buying anything.

BNPL industry

2. Higher Average Order Value (AOV)

People tend to buy more expensive stuff or add more items to their cart when they can pay later in installments.

This means stores make more money from each customer’s purchase.

3. Improved Customer Satisfaction

Customers like having options to pay in a way that fits their budget.

When stores offer flexible payment choices like BNPL, it makes customers happier and more likely to come back to shop again.

4. Access to a Broader Customer Base

Some people don’t use credit cards or prefer not to pay everything upfront.

By offering BNPL, stores can attract these customers who might not have shopped otherwise.

BNPL Gen Z Spend

5. Reduced Cart Abandonment

Many customers leave their shopping carts without buying because they see the total amount and are surprised.

With BNPL, customers know exactly how much they’ll pay each time, so they’re less likely to leave without finishing their purchase. Plus, you can reduce cart abandonment with SMS by sending timely reminders and personalized messages that encourage customers to complete their transactions.

6. Competitive Advantage

Stores that offer BNPL stand out from others because they provide more payment options.

This can attract more customers who like having flexibility in how they pay.

7. Upselling Opportunities

Stores can use BNPL to encourage customers to buy more expensive things by showing them how affordable it can be when paid in installments.

This can lead to customers buying more and spending more money.

In fact, around 2 in 5 people plan to replace their credit cards with BNPL (C+R Research)

Here are the most popular reasons for this.

HTML Table Generator

Reasons for BNPL Preference	Proportion Who Agree
Easier to make payments	45%
More flexible	44%
Lower interest rates	36%
Credit cards are maxed out	33%
Easy approval process	33%
Low credit card limit	22%
No interest	22%

8. Faster Inventory Turnover

With BNPL, stores sell products faster because more people buy things and spend more money.

This helps stores manage their stock better and keep their inventory fresh and interesting for customers.

👉 Read our insightful blog on AI in Retail

Retail POS Integration with BNPL Solution: 10 Crucial Steps for Success

As a product engineering company (with a deep expertise in RetailTech), we offer comprehensive retail POS integration services.

Here is a quick guide, prepared by our integration experts, to integrate BNPL with a retail POS system:

1. Research BNPL Providers

Identify reputable BNPL providers in your region or globally.

Some well-known ones include Klarna, Afterpay, Affirm, and Zip.

2. Understand Terms and Conditions

Review the terms, conditions, fees, and integration requirements of each BNPL provider.

Look for APIs, SDKs, or plugins they offer for POS integration.

3. Select or Make Your POS System Compatible

Ensure your retail POS system is compatible with integrating third-party services like BNPL.

If not, consider upgrading or finding workarounds.

4. Develop Integration Plan

Create a detailed integration plan that outlines the technical requirements, timelines, and resources needed for the BNPL integration.

5. Access API/SDK Documentation

Obtain access to the BNPL provider’s API or SDK documentation.

This will guide you on how to integrate their services into your POS system.

6. Test Environment Setup

Set up a test environment to safely experiment with the integration without affecting live transactions.

This ensures compatibility and reduces risks during implementation.

7. Integrate BNPL API/SDK

Use the provided API endpoints or SDKs to integrate BNPL functionalities into your POS system.

This may involve coding and testing to ensure smooth functionality.

8. Implement BNPL Features

Incorporate BNPL features such as displaying BNPL options during checkout, calculating installment amounts, and processing BNPL payments securely.

9. Test End-to-End Functionality

Conduct thorough testing of the integrated BNPL features within your POS system.

Test various scenarios, including successful BNPL transactions, refunds, and customer support interactions.

10. Launch and Monitor

Once testing is successful, launch the BNPL integration in your live POS environment.

Monitor transactions, customer feedback, and performance metrics to ensure everything runs smoothly.

👉 Read our detailed guide on Custom Retail Software Development

4 Strategies for Leveraging BNPL Integration to Drive More Sales and Revenue

As you already know, integrating BNPL solutions into your retail POS can significantly impact sales and revenue.

Hence, here are effective strategies to maximize its potential.

Highlight BNPL as a payment choice prominently during the checkout process.

Offer crystal clear information on how it works, such as payment installments over time without interest.

For example, a fashion retailer can display “Pay in 4 installments with 0% interest” as an attractive BNPL option during checkout.

Incentivize customers to choose BNPL by offering exclusive discounts or perks.

For instance, an electronics store could provide a 10% discount on purchases made using BNPL.

This not only encourages immediate sales but also promotes customer loyalty to BNPL as a preferred payment method.

Use the data gathered from BNPL transactions to create personalized marketing campaigns.

Analyze buying behavior, preferences, and demographics to customize promotions.

For example, a beauty brand can send targeted email offers for skincare products to BNPL users who have previously bought cosmetics.

Create loyalty programs specifically for BNPL users to encourage repeat purchases.

Offer rewards points, cashback incentives, or early access to sales events.

A sports equipment retailer could introduce a loyalty program where BNPL users earn points for every purchase, redeemable for discounts on future orders.

👉 Explore a comprehensive guide on Sustainable Retail with Generative AI

Addressing Key Challenges for a Successful POS Integration with BNPL Solution

Decoding the common concerns is essential for ensuring the success, sustainability, and trustworthiness of BNPL integrations within your business operations.

Here are some common challenges alongside best practices to avoid them.

1. Fraud prevention

Implement robust fraud prevention measures, such as identity verification or two-factor authentication.
Use fraud detection tools and algorithms to monitor transactions for suspicious activities.

2. Compliance

Conduct regular audits and assessments to identify and address any compliance gaps.
Work closely with legal and compliance teams to update policies.

3. Integration Complexity

Conduct thorough testing and debugging to identify and resolve integration issues early.
Work closely with BNPL providers and technical teams to streamline the integration process.

4. Payment Reconciliation

Regularly reconcile financial records and investigate any discrepancies promptly.
Maintain clear records of transactions and financial data for auditing and reporting purposes.

5. Scalability

Design systems and infrastructure to handle increased transaction volumes and user demand.
Work with tech teams to implement scalability solutions, such as cloud-based infrastructure or scalable APIs.

👉 Explore our NextGen Software Product Development Services

Azilen’s BNPL Expertise – A Comprehensive Case Study

The South Africa-based customer is a prominent provider of digital banking solutions, aiming to provide a top-notch payment solution that’s both superior and user-friendly for consumers and merchants alike.

Challenges

– Consumer Data Sovereignty

– Fraud & Risk Prevention

– Multi-technology Integration

– Transactional Info. Encryption

Key Highlights

– Multi-party transactions

– Historical payment data management

– Consumer credit score analysis

– Automated merchant settlement

– PCI compliant

– Financial reporting and accounting

How We Helped?

We teamed up with the client to create a modern Buy Now Pay Later (BNPL) payment system that works seamlessly with any E-commerce store.

This new solution made it possible for customers to pay without interest and helped businesses sell more.

Result?

– 30% Boost in sales

– 42K+ Active consumer base

– 300+ E-Commerce store integration

👉 Read the entire case study in detail Buy Now Pay Later System

👉 You should also explore our recently published blog.

Optimize Your Retail Experience with POS Integration and BNPL – How We Can Help

Shopping should be fun, not frustrating.

But let’s face it, clunky checkouts can wipe out a customer’s excitement much faster than a dropped ice cream cone.

As a product engineering company, we get it.

We’ve been in RetailTech for 15 years, and we know how to make the customer checkout journey as smooth as butter on warm toast!

Our seamless POS integration services are combined with the latest BNPL options.

Here’s a simple overview.

We’ll connect your existing Point-of-Sale system with popular BNPL providers.
Give your customers the payment flexibility they love, and watch their satisfaction rise.
Our smooth integration keeps the checkout line moving quickly, so you can focus on what matters.
Faster access to funds with BNPL transactions for a healthier cash flow for your business.

Let’s craft a winning retail strategy that puts your customers first, as always!

Maximize customer delight!

Integrate BNPL with Your POS to Boost Customer Satisfaction

Talk to Experts

Blog inner page

"*" indicates required fields

NAME*

FIRST NAME LAST NAME

EMAIL*

PHONE*

SHARE YOUR CHALLENGE*

Name

This field is for validation purposes and should be left unchanged.

Swapnil Sharma

VP - Strategic Consulting

Swapnil Sharma is a strategic technology consultant with expertise in digital transformation, presales, and business strategy. As Vice President - Strategic Consulting at Azilen Technologies, he has led 750+ proposals and RFPs for Fortune 500 and SME companies, driving technology-led business growth. With deep cross-industry and global experience, he specializes in solution visioning, customer success, and consultative digital strategy.