NatWest kills off its BNPL service less than two years after launch

NatWest, one of the UK’s leading banks, has announced that it will ditch its Buy Not Pay Later (BNPL) service. The bank, featuring over 18 million users, said that it will start the closure of BNPL accounts starting on May 7 of this year.

The announcement has caught many by surprise, but the bank said that the decision was made due to lower-than-expected use of the offering. At the time when it was launched, BNPL was accompanied by a lot of hype and excitement, and the bank expected to see a lot more of its customers rely on the option.

However, even though it has only been two years since the initial rollout, the bank recorded a strong drop in the feature’s popularity and usage. NatWest’s spokesperson said that the bank intends to double down on its core lending products moving forward and to help the customers spread the cost of their purchases through its credit cards, loans, and overdrafts.

As a result, Buy Now, Pay Later proposition will be closing.

NatWest’s BNPL offering fails as users show greater interest in its traditional plans

BNPL was originally popularized by several other apps, such as a Swedish company called Klarna. These services allow users to purchase goods and distribute the cost of their purchase across a certain period. Typically, this comes without incurring interest charges.

BNPL was introduced by a number of banks and financial services during the recent holiday season, and some estimates say that the service was used by around 15.1 million individuals during the holidays.

The figure also shows that BNPL was becoming widely adopted as a payment option, as even retailers like Argos and H&M started introducing it and their online checkouts. The benefit for the buyers is clear — they can purchase even high-cost items that they might not be able to afford, and break down the payment of the price.

NatWest’s BNPL offering allowed users to pay for purchases in four equal monthly installments without any interest. They could even manage the plans via the bank’s mobile app, making it simple to set up and convenient to use.

However, despite the fact that other brands have seen some success with this option, NatWest’s installment plan for credit card users has seemingly attracted significantly more attention than its BNPL offering. Some have speculated that the reason might be the fact that traditional plans allow greater flexibility, as they can be activated for up to five eligible transactions. Meanwhile, BNPL automatically applies installment plans to all purchases.