Buy Now Pay Later (BNPL) Gaining Momentum in Thailand

Buy now pay later (BNPL) has been picking up steam among curious consumers in Thailand. This type of financing has grown in popularity because it is seen as a more flexible and consumer-friendly alternative to traditional credit products.

It is reported that BNPL fintechs have already diverted US$8 to US$10 billion (THB280 billion to THB350 billion) of annual revenue away from banks globally. Thai banks would need to adapt fast and be more progressive to regain and retain consumers, as 70 percent of BNPL users would be willing to use BNPL offerings from their banks if they were available.

The COVID-19 pandemic impacted the growth of the BNPL industry in Thailand, forcing consumers to shop online with some turning to its services to manage their finances during these uncertain times. 

A study by Mastercard shows BNPL has room for growth as most Thai consumers (89 percent) are aware the instalment plans as a payment option but only a handful (26 percent) have used it last year.

However, 55 percent stated they were more likely to use BNPL for sizeable or emergency purchases, while 80 percent were interested in paying their bills using the option.

Thailand’s digital consuming and spending behavior

 A UOB Group insight analysed Thailand’s digital consumption and spending behavior. It stated that 70 percent of payment methods used by Thai consumers are made via mobile banking apps for in-store and online transactions, higher than the ASEAN average of 52 percent.

In addition, 44 percent also preferred digital or online banking channels, higher than the ASEAN average of 35 percent. Thailand also has the highest percentage of active users in digital currencies, with one in five people using cryptocurrency and other central bank digital currencies (CBDCs).

Payment methods used in the last three months for both in-store and online payments in Thailand, compared with the ASEAN average. Source: FinTech in ASEAN 2021 research

Payment methods used in the last three months for both in-store and online payments in Thailand, compared with the ASEAN average. Source: FinTech in ASEAN 2021 research

BNPL which is…

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