The financial super app will bring its ‘responsible’ Pay Later to Europe, starting off in Ireland this week.
Revolut is kicking off its ‘buy now, pay later’ (BNPL) launch in Ireland from this week.
The ‘responsible’ BNPL product, Pay Later, will be rolled out in Poland and Romania later this year, with an eye to further expansion across Europe from the end of 2022 onwards.
With the BNPL market in Europe set to grow to £680bn over the next five years, and the government’s announcement earlier this week that regulations will tighten, eyes are on the sector as more and more consumers turn to the unregulated credit through the cost of living crisis.
“Pay Later is an exciting and fast-growing area of personal finance and consumer spending, and we are excited to add Revolut ‘Pay Later’ to our financial superapp,” Revolut Europe CEO Joe Heneghan said.
Revolut says the new product will have built-in safeguards to ensure users can afford their Pay Later limit and offers a “more robust assessment” than its competitors because it approves the credit limit before the transaction rather than at the point of sale.
“Revolut Pay Later gives our customers more control and flexibility over their personal finances, in a responsible way, by enabling them to spread the cost of purchases over three instalments,” Heneghan added.
He said this will encourage people to pay off their purchases within a few months rather than turning to overdrafts and credit cards which “don't carry the same emphasis on quickly paying back the amount borrowed”.
A report earlier this month showed that more than 40 per cent of BNPL users borrow money to pay off what they owe.
There will be a 1.65 per cent fee per purchase repaid in the final two instalments and each customer will have a bespoke limit determined by the app’s credit assessment.