EAT NOW PAY LATER
Zomato has announced Eat Now Pay Later (ENPL) option for its customers to order food and pay for it at a future date. However, fintech like PayU, EPaylater, and Simpl are already offering credit to customers who order food online. The reason behind Zomato and Swiggy entering the BNPL segment is to save the commission it pays on the same. When a customer opts for the BNPL option, the companies pay the order value upfront to the food delivery platforms, however, charge a 1–2% fee. Therefore, Zomato and Swiggy, both have decided to set up their own BNPL companies, after getting all the required approvals to form an NBFC, to save the commission fee. These companies already have data about customers’ preferences and the kind of money they spend. Therefore, it would be easier for them to provide BNPL credit according to this data. Introducing the BNPL alternative can increase online orders, as McDonald’s experienced the same when it allowed people to pay using credit cards.