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SBS White Paper - Banks: How to prepare for BNPL

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The BNPL market is growing and evolving, impacting the expectations of consumers in their borrowing journeys P.16 BNPL: first step in the credit experience evolution BNPL is an attractive form of payment that drives purchasing decisions, particularly in today's inflationary economic environment. However, there are several things to keep in mind. For example, BNPL providers also feel inflationary pressures, so they need to reimagine how to offer this type of financing and make it profitable. Moreover, rules are on the horizon, ensuring Buy Now Pay Later is better regulated, BNPL lending by banks and fintechs is responsible, and customers are more aware of the intrica- cies and risks of the payment method. The BNPL market is growing and evolving, impacting the expectations of consumers in their borrowing journeys – not just BNPL, but mortgages, standard consumer credit, auto credit, etc. As such, all forms of lending will be forced to become more transparent, ensuring customers are fully aware of what they're agreeing to and how it could affect their creditworthiness.

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