As the financial landscape shifts, traditional banks are facing fierce competition from digital-native FinTechs, particularly in the realm of buy now, pay later (BNPL) services. A recent PYMNTS Intelligence report highlights the growing demand for BNPL among consumers, especially younger, tech-savvy shoppers who appreciate the flexibility of managing payments in small installments. This trend has led to a significant increase in BNPL transactions, with spending reaching $17 billion during the peak shopping season, indicating a clear consumer preference for these services. In response, banks are beginning to invest in their own BNPL solutions, such as U.S. Bank's Avvance, to retain customers who might otherwise turn to FinTech alternatives. Furthermore, traditional banks possess advantages over their FinTech counterparts, including consumer trust and established infrastructures, which can enhance their BNPL offerings. By leveraging these strengths, banks have a unique opportunity to capture market share and shape the future of financial services.
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