2 min read. October 6, 2021 – by Amanda D’Auria
With supply chain problems growing more frequent, many retailers are encouraging shoppers to start their holiday shopping early this year. In the past, some of those customers would’ve put items on layaway and paid for these purchases over time.
But this year, retailers are either scaling back or getting rid of layaway plans altogether. For instance, Walmart announced it’s getting rid of layaway for the 2021 holiday season. Instead, the company offers buy now, pay later (BNPL) options through its partnership with Affirm.
Layaway has typically been preferred by customers who don’t have the cash to pay for an item but don’t want to finance it with a credit card. When you put an item on layaway, the store will hold your items for you while you make payments on them.
Once you’ve paid for your purchases in full, you can take them home with you. In comparison, when you use BNPL options, you can take your purchases home with you immediately.
From there, you’ll make installment payments until the item is paid for in full. But while layaway comes with zero fees, BNPL options can come with an APR range between 10% and 30%. However, 0% APRs are available on certain promotional items.
Layaway had all but disappeared by the early 2000s, but the financial crisis of 2008 prompted many retailers to bring it back. As recently as 2018, 33% of shoppers said they planned to use layaway for their holiday purchases.
Many popular retailers are embracing BNPL options for customers as an alternative to layaway. BNPL is typically on items that cost $150 to $2,000. These financing plans are especially attractive to millennial and Gen Z customers who are more reluctant to take on credit card debt.
BNPL is seeing tremendous growth, and it’s currently the fastest-growing e-commerce payment. Well-known retailers like Best Buy, Sephora, Macy’s, and Apple all have embraced BNPL options.
If you’re considering offer BNPL financing to your customers, here are some of the biggest benefits:
National Business Capital helps entrepreneurs secure quick and fair financing to save time and cultivate sustainable growth.
Our stress-free online platform is designed for simplicity and speed, helping business owners go from application to approval in a matter of hours. And while we remain a leader in the Fintech industry, our clients agree it’s our personalized service and award-winning team that sets us apart.
From SBA loans to lines of credit, to equipment financing, and more, business owners can access all the different financing programs available to them in one place. Through our streamlined process, we have helped clients secure $2 billion in financing since 2007, and, more importantly, we’ve helped entrepreneurs save a tremendous amount of time and grow faster.
Amanda is the Marketing Coordinator for National Business Capital. She’s a graduate of Ziklin School of Business at CUNY Baruch College and holds a B.A. in Advertising, Marketing, and Communications. Amanda has extensive experience creating content, directing outreach campaigns, and managing operations. She is passionate about small business and helping entrepreneurs reach new heights.