The buy now, pay later whirl is leaving credit card companies unconcerned. Over the past year, lots of top merchants have added the ability for customers to divide up their purchases and pay them off over time. Amazon is planning to join the action. Consumers like the idea of the service, and spending with buy now, pay later providers is expected to soar to $100 billion this year. The option’s sudden popularity has sparked concern among investors that the developing space may decrease the share of customer spending currently captured by credit card issuers. This week, card executives shrugged off the looming threat. “That’s not really a large competitive threat to us,” American Express Chief Executive Officer said to analysts on a conference call. “It tends to be targeted at low FICO, it tends to be targeted at a lot of debit card users”.
Retailers are increasingly getting frustrated by the high costs associated with offering buy now, pay later options to their customers, according to some of the country’s largest credit card providers.
Buy now, pay later providers, for their part, argue that their offerings tempt customers to spend more with the Retailer.
