If I buy a product from a store that allows the use of BNPL, am I subsidizing these users, by having to pay a higher price to cover the BNPL providers fees the store incurs on these customers?
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Hi @Johnhv, welcome to the community.
There is no simple answer, but it is worth noting that many are similar to credit card merchant fees. For a yes answer, one would need to say that cash buyers are subsidising the credit card fees for those which use credit cards.
It is also worth noting that BNPL merchant fees are similar to credit card merchant fees…
What Is Buy Now, Pay Later? How BNPL Works (2022).
There are also reports that some merchants also pass on these fees to their customers, like credit card merchant fees, BNPL fees are passed on by some. In such cases it would be a definite no answer.
Where they aren’t passed onto the customer, the fees (like credit card, bank, foreign exchange etc) are included in the overall running costs of the business. They aren’t usually separated out and the profit margin on products sold using BNPL will be slightly less.
Are you subsidising, I would say no. Is the business making a slightly greater profit margin from non-BNPL sales, most likely yes if the same price is paid and BNPL fees aren’t passed onto the BNPL customer.
Is it fair, well if you are happy with the purchase price then yes. If you don’t think it is fair that the retailer might be making slightly higher profit margin on your purchases, why is one then making the purchase at that particular retailer.
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