What is PayPal Pay in 3?
Did you know that more than a quarter (34%) of UK consumers trust the PayPal brand, according to emerchantpay's 2021 New World, One Market report? With more than 400 million accounts worldwide, PayPal continues to lead the charge in the electronic payment revolution for more than 20 years. This easy-to-use eWallet enables consumers to make digital payments or use other financial services seamlessly and securely. According to Statista, PayPal boasted a total transaction volume of $339 billion in Q2 2022. Simultaneously, the value of the UK's Buy Now Pay Later (BNPL) sector is forecasted to hit £27 billion by 2024, accelerating the growth of eCommerce.
PayPal Pay in 3 is a payment method that involves short-term, interest-free payments. The solution enables customers to spread out the cost of their purchase of £30 to £2,000 into three payments with no added fees or interest.
In this article, we’ll explore PayPal Pay Later’s Pay in 3 across the UK, how it works, its popularity, and how emerchantpay can help merchants integrate it into their offering for sustainable business success.
PayPal Pay Later is also available for customers in Germany, France, Spain, Italy, Australia, and the US. If you want to learn about this solution, you can contact our team today.
How does PayPal Pay in 3 work?
At online checkout, the customer chooses PayPal and logs in to their respective account to access the Pay Later option. Two tabs labelled “Pay Now” and “Pay Later” will appear on the screen. Customers selecting Pay Later can apply for the Pay in 3 solution by confirming their account and payment details.
Then, they'll be given their purchase's three payment amounts. The first payment is charged at the time of sale from the funding source linked to the customer’s PayPal account (which can be a debit card or bank account). The remaining two payments will be covered on the same date in the two subsequent months.
What areas and verticals does PayPal Pay Later cover?
PayPal caters to the needs of consumers in every corner of the world. In terms of PayPal Pay in 3 across the UK and its eligibility requirements, consumers must have a UK PayPal account and a valid UK address. The customer must then be approved by PayPal for Pay in 3.
It should be noted that Pay in 3 is available for eCommerce sales between £30 and £2,000 from most online stores accepting PayPal. However, for some merchant categories, such as gambling and financial trading, access is restricted.
How big is BNPL penetration in the market?
According to Statista, BNPL options have begun to take strides in the eCommerce market worldwide, accounting for 3% of the global market share. The UK seems to be a promising market for BNPL adoption. Our New World, One Market report presents Gen Z as the age group with the highest appetite for this payment option, with almost five out of ten (46%) consumers using it.
Survey from Finder uncovers that a third of UK consumers (37%) out of 2,000 people surveyed have used BNPL, while the majority (44%) favours the service for the ease and convenience it offers. On a global level, despite BNPL's prevalence in Germany and Sweden, our Global Payments Outlook 2022 report revealed that the service is also gaining traction in North America. Precisely, a whopping 81% of consumers used a BNPL payment solution for their online and in-store shopping as of 2021.
Benefits of using PayPal Pay in 3
PayPal Pay Later’s Pay in 3 can unlock greater eCommerce opportunities for both consumers and merchants. Below is a list of some of the benefits for merchants and customers:
For merchants
- Simple integration and no additional costs as Pay in 3 is included in your existing PayPal rate.
- Getting paid up front and in full, while letting customers spread their payments over time.
- Help increase order and sales volumes when customers are given the flexibility to divide their payments.
- Seamless product promotion when adding Pay in 3 messaging to your website, so your customers know they use BNPL.
For customers
- Zero fees or interest for using Pay in 3 or on the total value of a customer's purchase if they're late with a payment. However, late payments could impact their ability to access Pay in 3 and other credit in the future.
- Increased spending power which enables customers to split their costs into three payments over a longer time and thus better manage their finances.
- Trusted and transparent payment solution, as users will receive an email or SMS reminder to notify them about their next scheduled payment.
- Automatic payments applicable to the second and third payments that will be automatically deducted from the consumer’s funding source by PayPal each month.
Accepting PayPal Pay in 3 payments with emerchantpay
There’s no doubt that PayPal Pay in 3 is a valuable addition to the existing payment methods of your eCommerce store. By giving customers the flexibility and option to split their payments into instalments, merchants are more likely to increase their revenue and generate more repeat custom.
At emerchantpay, we empower businesses of all sizes to build engaging and seamless payment experiences for their customers. Working with an established payment service provider in the UK like us, with more than 18 years of payment processing experience, can help you boost your profitability and conversions. Not only do we help onboard merchants with a PayPal account via our in-house payment gateway; but we can also orchestrate and ensure a seamless fund movement from the user's account to the merchant's account.
Ready to accelerate your growth and increase your revenue? Contact our payment experts to discuss your options and make the most out of the PayPal offers.
* Pay in 3 availability is subject to merchant status and integration. Consumer eligibility is subject to status and approval. Pay in 3 is a form of credit, may not be suitable for everyone and use may affect consumer’s credit scores. See product terms for more details.