What does trust at the checkout look like? 

Neha Mittal
25 July, 22
The Buy Now, Pay Later (BNPL) space has taken the retail industry by storm. Shoppers can now buy their most wanted items without worrying about the immediate hit to their bank account. However, an ongoing concern amongst consumers is not knowing who they make the agreement with at the point of sale.

Many consumers will happily checkout with their established bank, but when it comes to a third-party, users may feel less comfortable as there is no existing relationship here built on trust. So much so that 53% of BNPL users believe that borrowing from credible lenders is important when using this service. When the payment is split into monthly segments and a contract is signed, trust is incredibly important to consumers. 

The main issue for merchants is whether they manage the consumer’s entire journey or whether they outsource this to a third party providing the staggered finance solution. When the consumer is about to make the purchase and is taken off to an unfamiliar site, this can be the difference between a successful transaction, and an abandoned cart.  

With advancements in alternative finance gearing up in recent years, trust at the checkout is one of the most important factors in ensuring consumers continue to use these methods in a safe and secure way.  

Confidence at checkout  

If trust at the checkout can make or break a sale, and a merchant considers their brand to be trusted by their customers, then they must design a checkout journey that engenders that trust.   

Familiarity is what counts. Some merchants have discovered the optimal way to achieve this is by embedding the BNPL application process within their site, so that their logo, their tone of voice and their colour palette remain front and centre throughout. Better still if they can achieve this without having to use a different URL, while reinforcing secure browsing and data security protocols.   

If a merchant’s lending partner is trusted and familiar, then they may benefit from co-branding at key points of the journey. At a minimum, and to be compliant, they’ll need to ensure the customer has full transparency of who will be providing their loan, and how their data will be shared.    

Additional techniques to improve trust and conversion include reinforcement of security provisions, “social proofing” messages on the number of other users who have successfully taken this route, a clear explanation of repayment terms, and full contact details for lender customer support.   

Shrewd merchants also understand that by hosting the BNPL journey they have visibility of the data about their customers’ experience, and with that the opportunity to test, learn and optimise conversion success. What’s more, this data can become a treasure trove of insights that can be used to personalise further up the purchase journey, as well as for ongoing loyalty. So, by owning these insights, and controlling what each customer sees, merchants create a new communications and marketing channel, which they can use to generate more sales or build further trust.  

Putting the consumer first 

As we are no longer in the ‘honeymoon’ period of Buy Now, Pay Later, the speed of rolling out these services is no longer as important. What we’re seeing now is a desire to make sure that the services offered are putting the consumer first. Especially with high ticket items, it is key for the consumer to have comprehensive trust that the provider lending the credit is credible. When consumers are redirected to third-party sites to complete the transaction, separate contracts must be signed and may therefore lead to feelings of unease.  

Many have argued that focusing on trust at the checkout is perhaps a negative way of looking at this prospering market. Many BNPL providers have taken advantage of the loopholes in this space. Credit checks have until recently been non-existent and the only real regulation in the industry occurred way back in 1974 with the Consumer & Credit Act.

By focussing on how consumers face harm, it is more likely that we will see regulation hit this space which will allow for more prosperous use for all sides. It is common knowledge that BNPL is a hot topic in the finance space, but without the necessary measures to make sure old and new consumers feel protected, there is a danger that the perception of BNPL may continue to suffer.  

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