What BNPL Means to Your Merchant Onboarding Process


December 7, 2021

Forward-thinking Payment Service Providers (PSPs) are constantly adding products to attract new merchants as the digital payments industry continues to shift in favor of “buy now, pay later” (BNPL) services.

We recently covered how BNPL services have become one of the biggest market disruptions of 2021, but as far as PSPs are concerned, BNPL is simply another product or tool in your portfolio of merchant offerings. That being said, PSPs take on additional risk when cash-strapped shoppers take advantage of these services during checkout on merchant websites.

How then do payment service providers (PSPs) protect themselves from unnecessary risk as more merchants look to offer BNPL payment options to their customers? Part of that answer is adding intelligent, automated underwriting to your merchant onboarding process with Merchant ScanXpress from Agreement Express.

With Merchant ScanXpress you can build custom risk scorecards for different merchant types, such as those retailers who use BNPL, standard credit cards, Apple Pay, and so on. Those merchants who opt to utilize BNPL services will have a unique threshold for approval based on the higher risk of consumer default with BNPL.

Thanks to the AI-generated merchant risk alerts from Merchant ScanXpress, your underwriters can quickly identify those accounts during the onboarding process. This automated underwriting process is completely invisible to the merchant so you won’t have to worry about application abandonment.

The variety of BNPL digital payment solutions gathered significant steam during the pandemic. Most market analysts believe the demand for BNPL is likely to grow in 2022. The biggest question you have to answer as a digital payment service provider is whether your underwriting solution is able to adapt to the market demand for BNPL services or whether you will be left behind.

transform your underwriting process