If 2021 was the year Buy Now, Pay Later (BNPL) seemed to arrive, 2022 could see these providers reset the standard for customer experience (CX) in the credit market. But will they?
Anytime a disruptive force enters a market, there’s a great deal of excitement. People talk (and often over-hype) the potential of the new technology or service being brought to bear, and the eyes of legacy players, the media and analysts start to focus on the new kid on the block.
With BNPL, the range of players is increasing exponentially, and the customer base continues to grow at pace too as consumers embrace the model. And this means the regulators are rightly starting to develop plans to ensure that the right checks and balances are in place across the industry.
But, whatever happens in terms of legislation, where I have hope for the BNPL market is in its potential to transform consumer expectations of CX, raising the bar for the credit industry as a whole and differentiating providers from one another.
What’s encouraging for me is the consideration bring given to the customer experience beyond the point of purchase, arguably the greatest opportunity to disrupt the credit arena.
This opportunity, though, is not the exclusive domain of any single part of the credit sector. Rather, it’s the duty of all involved.
Stronger consumer protections that enable innovation should be welcomed. Reciprocal reporting from across the credit spectrum should be used to help protect the most vulnerable. Proactive interventions should be used to prevent new purchases from customers with outstanding debts from falling into further arrears.
Why do I believe this is possible? Well, if you look at the front end of BNPL experiences they are digitally-led and tend not to be shackled to the kind of legacy systems and processes that traditional credit providers have to navigate through. This means they have the potential to act with agility and adapt in the face of ever-changing conditions and end user demands.
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While the BNPL space as a whole makes hay as the sun continues to shine – e.g., growth and investment – the smartest cookies among them will already be talking about differentiation.
And if they can extend the same thinking that went into developing the front-of-house systems and journeys through to the back-end and, critically, the collections experience they could be building some very strong foundations indeed.
As the BNPL space continues to evolve, it doesn’t do so in isolation. A more consumer-centric view of the entire operation, from eligibility processing through to the collections experience, can only be a positive.
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