Called Flexbase Pay, this product gives merchants an opportunity to increase their revenues while granting businesses greater freedom in payment options, including 60 days of interest-free credit.
Buy Now, Pay Later (BNPL) lets businesses make purchases and receive them immediately but pay for them after 60 days. While it has been widely available to consumers, businesses have a different underwriting process that Flexbase handles through this offering, providing a consumer-like experience of receiving financing in less than five minutes.
Merchants using Flexbase Pay simply provide a ‘Pay in 60 days with Flexbase’ button in their checkout pages to enable the functionality.
Flexbase is a finance super app for businesses providing them tools to start, grow, and protect their business. Its flagship product is a 0% APR for 60 days financing product. Flexbase offers business credit through its Flexbase Credit Card and Flexbase Pay. Flexbase aims to be the financial backbone of all growing small businesses with a comprehensive set of products.
Merchants typically pay the BNPL provider between 2% and 8% of the purchase amount, and in some cases a small per-transaction fee. Providers typically don't disclose their pricing up front, so merchants interested in pursuing a relationship with a BNPL provider should expect to go through a process of registering an account and submitting business information to receive a quote.
BNPL services can be particularly valuable for merchants who sell goods or services that come with a hefty price tag, as the option to pay nothing up front can help hold onto customers who might otherwise be driven away by sticker shock. Different BNPL providers have claimed increases in average order value ranging from 40% to 85% for merchants who partner with them.
For consumers, BNPL is a welcome alternative to paying with credit cards, as many are cautious of accruing that form of debt. Paying off a purchase in a series of interest-free installments is more appealing.
B2B customer relationships are more complex. The marketing and selling process is longer and often involves multiple channels that include some level of managed sales. There is more customisation in offerings and accompanying services.
Business buyers want the same digital experience they get as consumers and business merchants are looking for every opportunity to improve their customer relationships, increase average order size, and capture a larger share of wallet. The market is underserved, with startups just recently beginning to tap into this huge opportunity.
Small business buyers need access to affordable credit and financing options. Financing has always been a challenge for small and medium-sized businesses (SMBs), and COVID-19 has only exacerbated the problem.
The construction industry is dominated by progress payments, which are payments paid out based on the percentage of work that is complete. However, in Europe, for instance, BNPL is informally adopted by construction SMBs mostly twice per year – right before summer vacations start and right before Christmas starts.
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