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Flexibility Without Compromise: Trust and Reliability Are Key for Consumers and Merchants in Emerging Installment Payments Market

Brian Weiner Vice President & Head of Product & Digital, Visa Canada

Paying for purchases in smaller, regular intervals is a choice that a growing number of Canadians are looking for. Here's how Visa’s new Installments solution will help financial institutions offer consumers more choice and control over their budget. Veronica Stephenson

hen it comes to purchasing decisions, it's clea r t hat Canadians wa nt more options for when and how they pay for purchases. Installments — also known as “buy now pay later” plans, which involves dividing total purchase amounts into smaller, equal payments made over time — is a rapidly-growing trend. It's seeing accelerated adoption across the globe as it represents increased choice for consumers, and the ability for merchants to up their competitive advantage and bring shoppers more ways to pay. “In Canada, we’ve seen 30 percent growth in installments in the last year alone,” says Brian Weiner, Vice President and Head of Product and Digital at Visa Canada, referring to an Ipsos September 2020 study. “The pandemic has accelerated the growth and speed of digital payments everywhere and created room to insert additional options for consumers and merchants.” It's not a new phenomenon — installments have been popular in markets like South America and Europe for a long time. The Australian market is expected to double by 2023; in the U.K., it's expected to double by 2025.1 However, it's not just customers driving this trend. According to Shopify’s recent report on the Future of Commerce, the number of Shopify merchants in the U.S. offering installment payment options has increased by 60 percent since the start of the pandemic.

Canadians of all generations are adopting innovative payment options The data suggests that the installments trend is here to stay. As is common for any industry undergoing a period of rapid growth, the payments ecosystem is also experiencing disruption and innovation. The pandemic is continuing to push businesses to offer improved consumer

experiences, with digital-first ways to pay. also be made available by Canadian issuAnd consumers of all ages are embracing ers at participating merchants during the flexible payment solutions like installments. checkout process. “With the Visa solution, “We know that Gen Z and millennials buyers use existing accounts and lines of are a new class of consumer who expect credit from the bank or card issuer they flexibility and choice,” says Weiner. “But, know and trust. There's no need to downinterestingly, the biggest load an app, submit a new growth of interest since credit check, or enter any 2017 has come from Gen additional information,” X and baby boomers. And says Weiner. “If you have as consumers seek more an eligible credit card, the purchase will autoflexible options, transparency and trust remains of matically be deducted In Canada, high importance among from your available credit we've seen 30 percent all demographics.” line. Allowing consumgrowth in installments To better protect ers to make this choice in the last year alone. the long-term health of without taking on any The pandemic has financial ecosystems, it's new credit is a key comaccelerated the important that installment ponent of the solution.” growth and speed providers understand the W here mercha nt s of digital payments needs of consumers and have opted into the dureverywhere and merchants in today’s paying-purchase installment created room to ments market. program, Canadian coninsert additional “Visa is in the great sumers will be able to options for consumers position of being present choose whether to pay in in and observing markets smaller, regular amounts and merchants. all around the world, and at the point of purchase. our goal is to bring the best With transparency related payments experiences to Canada,” says Weiner. to the payment schedule, the solution is “Installments aren't new, but we’re seeing their geared towards providing consumers with resurgence in a modern economic context. more control over their budget. For merchants, opting into the program At Visa, our vision is to create a solution built on a foundation of trust and responsibility, can also carry significant benefits. The soludesigned with the well-being of both Canadian tion is designed to be seamless, and easy to consumers and merchants in mind.” use for customers. Integrating an installments option at checkout can increase both Canadian consumers and the average ticket size of purchases and conmerchants first to benefit from version rates for shoppers.2 Visa’s new installments solution “Our solution is API-based and designed This summer marks the launch of Visa Installto be very simple to integrate for both ments in Canada — one of the first countries in-person and e-commerce transactions,” to launch globally. Visa Installments will give says Weiner. “With a single integration, a eligible credit cardholders the option to divide merchant can enable installments options purchases they’ve already made (online or for their eligible customers without them in-store) into smaller, equal payments over needing to sign up for a new service or be a defined time period, based on the existing directed to another page and asked to fill credit available on their credit cards. out an application form. It doesn’t get any Looking ahead, Visa Installments will easier than that.”

Strategic Account Manager: Anna Sibiga Country Manager: Nina Theodorlis Content and Production Manager: Raymond Fan Designer: Lauren Livingston Web Editor: Karthik Talwar All images are from Getty Images unless otherwise credited. This section was created by Mediaplanet and did not involve National Post or its editorial departments. Send all inquiries to ca.editorial@mediaplanet.com.

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To learn more about installment payment options, visit visa.com/ installments. This page was sponsored by Visa.

Euromonitor Global Installment Payment Opportunity Report Euromonitor research: Interbank Cards Centre of Turkey