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Lay Bys are a better option than BNPL

Many businesses offer in house lay by or "pay it off and collect it then" facilities.

In some countries that sort of sale is known as a "Layaway".

Many retailers also have an arrangement with a BNPL business whereby a customer can take delivery of an item that is financed by the BNPL enterprise. The customer gets the product then and there and the merchant takes a hit or loss on the retail price. The BNPL service takes a percentage of the sale price of the item as its fee.

The merchant loses on that deal but there is a suite of claimed side benefits for the merchant. These include the assertion that customers will spend more, that they will buy then and there at a merchant rather than moving on to another retailer and that goodwill will flow to the merchant resulting in further business another day.

What are Lay-Bys

A lay-by purchase is an arrangement or agreement between a retailer and any customer where both agree on a sale price and conditions for payment where the merchant holds the goods until the customer makes all of the payments.

Typically, retailers do not charge interest on the outstanding amount of the purchase price.

Using in house lay by options

If a merchant offers the option of letting a customer put an item aside and after paying a deposit, paying it off in flexible installments over time, there will not be a BNPL fee.

Benefits for customers if they avoid using BNPL services and using lay by instead.

The fine print of most if not all, BNPL contracts is that all applications for the service, will be referred to a credit reporting agency.

The fact that a customer has applied for a loan for say a $160.00 pair of Nike AirForce 1 shoes will be reported to a credit bureau.

If a customer defaults on a payment or fails to pay at all, the breach of contract will or may be recorded on credit reports against the customer who bought the Nike shoes.

There is no privacy when dealing with BNPL services.

The customer's credit card or debit card will be used for payments and therefore the customer's bank will know that he or she needed a loan for a consumer item.

For the customer, it might be wiser to not get involved with BNPL so as to save up applications and credit bureau scrutiny for loans that really matter: cars, property purchases or applications for a rental property.

Customer's should also be aware that a BNPL's service conditions include the warning that bad debts may be sold to a debt collection service which will not be bound by rules and conditions that relate to the BNPL service that financed the Nike shoes.

Consumers should consider paying off the product that they need directly with the retailer instead of getting a BNPL loan.


There might be short term gains from additional sales for merchants to work with BNPL businesses but the downside is that customers might not show them a lot of "goodwill" if things go wrong when "their" customer has an adverse experience with a BNPL service. is where businesses can showcase their layby, layaway or LayBuy options. is where from later this month, consumers can locate a business that allows them to buy normal and sale price products that can be held for them until they have paid the full amount.


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