Home Strategy Aussies lead the way in adoption of ‘pay-later’ tools for short-term borrowing
Aussies lead the way in adoption of ‘pay-later’ tools for short-term borrowing Image courtesy of sixninepixels at FreeDigitalPhotos.net Featured

Payment service providers in the Asia Pacific region have been driven to offering online pay-later options to consumers hampered by limited borrowing options – with Australian consumers, and their Chinese counterparts, leading the way as early adopters of the deferred payments concept.

The borrowing issue for consumers comes as widespread smartphone adoption, a growing middle-class population and rising Internet penetration, are all set to drive the Asia Pacific ecommerce market from a value of US$1.4 trillion in 2017 to more than US$2 trillion by 2020, according to a new report from data and analytics company GlobalData.

But, GlobalData cautions that the growth is limited by insufficient borrowing options available to consumers, and is resulting in “high cart abandonment rates”.

Against this backdrop, GlobalData says online pay-later tools are now fast emerging as a viable form of short-term borrowing – with Australia and China being the early adopters of the deferred payments concept as it slowly gains popularity across the region.

The company says a number of payment service providers as well as online merchants are offering the “pay-later” solutions to online shoppers to allow them to pay for their purchases at a later date at no charge, though a late fee is charged if the agreed date is missed.

And while the overall business model remains similar across the Asia Pacific, companies have set their own repayment terms and pricing policies in different markets.

AfterPay and zipPay in Australia are now offering convenient credit financing options for a large proportion of online shoppers, says GlobalData, and Ant Financial, a subsidiary of China’s Alibaba Group, offers a similar service on online purchases made via its Alibaba website.

In India, with credit card penetration at just 2.8 cards per 100 inhabitants, and the limited availability of short-term credit, GlobalData says online pay-later tools provide significant growth prospects for the country’s ecommerce market.

GlobalData also says LazyPay — one of the initial benefactors of this payment service — is now a well-known brand, offering pay-later options to more than 250,000 customers in collaboration with major online merchants, including Zomato, Swiggy, Foodpanda, Redbus, and Faasos.

Other providers identified by GlobalData as following suit include Simpl and ePaylater, with the company also noting that in addition, leading online retailer Flipkart and cab aggregator Ola have introduced their own deferred payment solutions for loyal customers.

“The rise in consumer preference for deferred payment for online purchases mainly stems from the convenience and affordability it provides to pay at a later date,” says Shivani Gupta, payments analyst at GlobalData.

“An increasing number of PSPs in the region have launched solutions that could be classified into two main categories. The first allows customers to pay cumulatively for all the purchases made over a few weeks, while the second offers extended credit, allowing users to repay in bi-weekly instalments. This results in less frequent cart abandonment and increased online purchases.”

GlobalData says LazyPay in India generates invoices on the 1st and 16th of every month, to be paid within the next three days via online banking, debit, or credit card – while AfterPay in Australia, on the other hand, offers an extended pay-later option with four equal instalments due every two weeks. The amount gets deducted automatically on the due date from a linked debit or credit card.

New Zealand has also seen a spurt of PSPs, including PartPay, Oxipay, and Laybuy, offering similar services, Global Data notes.

“PartPay allows customers to pay only 25% of the total purchase amount upfront and the remaining in three equal fortnightly instalments via debit or credit card. Charges are levied on customers only in the case of delayed payment. For instance, LazyPay charges up to 18% interest on the outstanding balance on a daily basis, while a flat fee of A$10 is charged in the case of AfterPay.”

“With growing consumer spending and a rising appetite for short-term financing, the pay-later concept presents huge potential in Asian markets. However, its success will rely on greater merchant support, a focused campaign to generate consumer awareness, and a positive online customer experience with these solutions,” Gupta says.


With 50+ Speakers, 300+ senior data and analytics executives, over 3 exciting days you will indulge in all things data and analytics before leaving with strategic takeaways that will catapult you ahead on your journey

· CDAO Sydney is designed to bring together senior executives in data and analytics from progressive organisations
· Improve operations and services
· Future proof your organisation in this rapidly changing technological landscape
· CDAO Sydney 2-4 April 2019
· Don’t miss out! Register Today!
· Want to find out more? Download the Agenda



Australia is a cyber espionage hot spot.

As we automate, script and move to the cloud, more and more businesses are reliant on infrastructure that has the high potential to be exposed to risk.

It only takes one awry email to expose an accounts’ payable process, and for cyber attackers to cost a business thousands of dollars.

In the free white paper ‘6 Steps to Improve your Business Cyber Security’ you’ll learn some simple steps you should be taking to prevent devastating and malicious cyber attacks from destroying your business.

Cyber security can no longer be ignored, in this white paper you’ll learn:

· How does business security get breached?
· What can it cost to get it wrong?
· 6 actionable tips


Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).


Popular News




Sponsored News