MasterCard announced this week on Sept. 28 its launch of MasterCard Installments, its new foray into the flexible buy-now, pay-later payment installment plan service market.
The program will first come to market in the United States, United Kingdom and Australia.
Startup firms like Klarna, Affirm, Afterpay and Square have dominated the payment form so far, and MasterCard is looking to meet consumer demand that has grown since the pandemic shift to greater consumer preference for online shopping.
MasterCard Installments will be accessible for online purchases as well as in-store ones, by adding the feature to a digital wallet payment method.
The program features 0% interest rates and allows consumers to pay back their purchase in four installments.
“At the heart of it, payments come down to choice ”“ and people want more from their money with greater flexibility and control in how they pay and where they shop,” said Craig Vosburg, chief product officer at Mastercard. “Mastercard Installments has been built on our guiding principles to protect consumers and enable choice without sacrificing trust and security. It is a digital-focused way to pay today and tomorrow, delivered through consumer”™s most trusted relationships with their banks and other lenders, at merchants of their choice.”
On the merchant side, the feature enables retailers to only have to integrate it minimally into their infrastructure for those that already accept MasterCard, unlike other payment installment services that have to be integrated more thoroughly.
According to research from MasterCard, buy-now, pay-later options have been shown to increase average sales by 45 percent and reduce cart abandonment by 35 percent.
MasterCard is partnering with Synchrony ”” located in Stamford ”” Barclays U.S., Fifth Third, FIS, Galileo, Huntington, Marqeta and SoFi to roll out the program in the United States.
