The BNPL apps, also known as installment apps, have changed the way customers purchase products through flexible payment methods over time.
The BNPL industry has revolutionized the retail market by offering options that can help finance purchases and power growth. Companies like AfterPay and Klarna have set such a high precedent. Many companies are looking into developing their own BNPL apps. But how do you unshackle the potential for success of creating such an app?
This blog is about the cost and how to create a BNPL app. From selecting BNPL app developers to tailor-made and White-label BNPL app development. We will reveal all the important information. This guide contains information for an e-commerce brand interested in BNPL options for online shops and a business. This helps you to create a Buy Now Pay Later application!
Understanding Buy Now Pay Later App
A BNPL app is a contemporary payment technology system that enables clients to pay for their required products and services. The cost will be paid in equal and affordable installments. Over a given period, without attracting any interest from the seller or the third-party financing provider.
While customers pay for the product on an installment basis, merchants enjoy outright cash payment. This means that the business’s cash flows are not interrupted. This model also helps consumers and improves further sales for brands and companies.
Based on the analysis of the study’s key findings, it is evident that the NPL market has experienced fast growth recently. Based on a report by Allied Market Research, the global Buy Now, Pay Later market size was $120 BN in 2021.
It will reach $3.68 Trillion in 2030 at a supersonic CAGR of 26%. Due to the growing trend encouraging online purchases and consumers’ desire for as many payment methods as possible! Then this growth was realized.
Top 10 Popular BNPL apps
| App Name | Description | Total Users | Founded Year | Business Valuation |
|---|---|---|---|---|
| Klarna | A Swedish BNPL service offering flexible payment options for online shoppers. | Active users and GMV of leading BNPL providers Klarna, Afterpay, and Affirm 2022-2024 | 2005 | Once valued at $46 billion in 2021, the company saw its valuation fall dramatically to $6.7 billion in 2022. Currently, Klarna aims for a $20 billion valuation for its IPO. |
| Afterpay | An Australian BNPL platform allowing consumers to pay for purchases in four installments. | Active users and GMV of leading BNPL providers Klarna, Afterpay, and Affirm 2022-2024. | 2014 | Block splits the revenue and gross profit from its BNPL platform between Square and Cash App. |
| Affirm | A U.S.-based BNPL provider offering installment loans for online purchases. | Affirm had about one-third market share of the volume. | 2012 | Affirm’s gross merchandise volume rose 35% during the quarter ended Sept. 30 from a year earlier, to $7.6 billion. |
| PayPal Pay in 4 | A BNPL service by PayPal allowing users to split purchases into four interest-free payments. | PayPal topped a download ranking for the United States in 2023. | 2020 | PayPal’s market cap is approximately $90 billion. |
| Sezzle | A BNPL platform focusing on financial empowerment, offering interest-free installment plans. | By June 2021, it boasted over 10 million user sign-ups and 48,000 participating merchants. | 2016 | Sezzle became the first BNPL company to incorporate as a Public Benefit Corporation in 2020. |
| Zilch | A UK-based BNPL provider offering interest-free credit options and reporting to credit agencies. | Zilch amassed more than 4 million registered customers within 44 months. | 2018 | In October 2021, Zilch’s valuation reached $2.2 billion. |
| Scalapay | An Italian BNPL service allowing customers to split purchases into multiple installments without interest. | Scalapay serves more than 6 million customers in Europe. | 2019 | In September 2023, Scalapay partnered with VISA to enhance its services. |
| Zopa | Originally a peer-to-peer lending company, Zopa has expanded into BNPL services. | In early 2023, Zopa had around 850,000 customers. | 2005 | In December 2024, Zopa raised $87 million in equity at a valuation exceeding $1 billion. |
| Openpay | An Australian BNPL provider offering flexible payment terms for underserved markets like healthcare and home improvement. | Openpay provides flexible payment terms for markets that it considers underserved. | 2014 | Openpay has established itself in markets like home improvement and healthcare. |
| Billie | A German B2B BNPL provider offering installment solutions for businesses. | Billie is making a name for itself by providing businesses with smooth financing options. | 2016 | Billie has partnered. |
- AfterPay: A well-liked virtual reference platform in Australia that is widely used globally due to its easy-to-use interface.
- Klarna: A Swedish-based BNPL app focused on flexible payment solutions and easy-to-use applications.
- Affirm: Popular in North America, they advertise flexible and clear pricing along with 0% interest plans.
Why Do You Need to Build a Buy Now Pay Later App?
- Boost Conversion Rates: BNPL apps can raise conversion rates by up to 30% since customers feel more confident purchasing. Because they have a flexible option to pay for the costs incurred. This added convenience decreases cart abandonment and increases business sales.
- Expand Customer Base: BNPL solutions attract various consumer profiles, including the youth. This also attracts millennials and Generation Z consumers who seek flexibility. BNPL helps you introduce new clients and expand your company’s customer base across various age groups and genders.
- Enhance Customer Loyalty: Introducing more BNPL options means that customers regain their trust and come back to buy more. Customers like this strategy because they are allowed to select their preferred time. On the same note, this is a good way for companies to foster existing customer relationships. Thus, massively increasing their retention rates.
- Tap Into a Thriving Market: Today, BNPL is massive and has an even more significant possibility! Because its market is expected to hit $3.68 trillion worldwide by 2030. Creating a BNPL app puts your business in an emerging segment, which the clients are gradually adopting.
- Stay Competitive in E-Commerce: Since the number of companies using BNPL solutions is growing, this payment option is now obligatory to remain competitive. A BNPL app ensures you stay relevant by catering to people’s evolving needs. It also improves convenient and versatile payment solutions.
The process of Building a BNPL App
1. Market Analysis and Competitor Research
Conduct good research on the market and competitors to come up with loopholes in the market. This insight will guarantee your app’s responsiveness to customer needs. This also helps you rise to the challenges in the harsh BNPL environment.
2. Feature Prioritization
Elements like real-time credit reports, choices of payments, and security of the transaction must be described. These ensure the app’s usability when developed and facilitate the creation of the best and most standard user interface.
3. Integration of Advanced Technology
The following technologies can be adopted for credit risk through AI and blockchain for safe transactions. It is essential because these innovations can improve the application’s functionalities and develop user confidence.
4. Post-Launch Support and Updates
Therefore, concentrate on users’ feedback collection and reflection of changes in a program after it has been deployed. This keeps your BNPL app up-to-date and valuable in today’s changing environment. This also propels your app forward through standard updates and new features.
Advantages of Developing White-Label BNPL App
1. Faster Time to Market: White-label solutions already have the default structures so that you can start your app in weeks rather than months. Such a speed proves advantageous since it allows someone to enter the market as soon as possible.
2. Cost-Effective Development: Forego a lead time of six months for development and cost savings of up to 40% compared to creating a new app. White-label solutions do not require significant coding, so they are affordable regardless of the organization’s size.
3. Customizable Branding: All these solutions have been developed to be bespoke for your brand icon, logos, colors, and features. This way, it ensures that your financial institution approves your BNPL app. It also meets your business objectives and customers’ expectations would be easy.
4. Seamless Scalability: As your business grows, you can easily add advanced features or increase the number of users it supports. Both white-label applications are created with future growth factors in mind, so they should not fail.
5. Reliable Support and Updates: White-label providers typically offer technical and update services. This means that throughout your application usage, often over several years. Your application should stay operational, secure, and capable of utilizing the latest technologies.
The Cost Breakdown of Creating BNPL Apps Like AfterPay and Affirm
This table provides a comprehensive cost and time breakdown for each phase of developing a BNPL app. It includes advanced features and highlights key development aspects of mobile app development services.
| Development Stage | Details | Estimated Cost | Estimated Time |
|---|---|---|---|
| Requirement Analysis | Detailed research and documentation of app requirements. | $3,000 – $6,000 | 1–2 weeks |
| UI/UX Design | Advanced design with wireframes, prototypes, and user testing. | $8,000 – $12,000 | 3–4 weeks |
| Frontend Development | Responsive and accessible interfaces for all devices. | $15,000 – $25,000 | 5–7 weeks |
| Backend Development | Scalability with microservices architecture and secure APIs. | $20,000 – $35,000 | 6–8 weeks |
| AI-Powered Credit Scoring | AI integration for personalized credit scoring and risk assessment. | $7,000 – $10,000 | 3–4 weeks |
| Fraud Detection System | Implementation of machine learning algorithms to prevent fraud. | $6,000 – $12,000 | 4–6 weeks |
| Testing and QA | End-to-end testing, performance checks, and bug fixes. | $8,000 – $12,000 | 3–4 weeks |
| Deployment and Support | Cloud deployment, server setup, and maintenance. | $5,000 – $8,000/year | Ongoing |
Total Estimated Cost: $72,000 – $120,000
Total Development Time: 26–35 weeks
# Factors Influencing Cost:
- Complexity of Features: Advanced credit checks or any risk assessment driven by artificial intelligence. This is considered to facilitate the process but it’s costly.
- Platform: The decision to build an application for iOS, Android, or both affects cost.
- Team Location: North America is more expensive than other regions, where you can hire a BNPL app development company.
Country-Wise Development Cost for BNPL App
| Country | Android (per hour) | iOS (per hour) | Cross-Platform (per hour) |
|---|---|---|---|
| USA | $150 – $200 | $150 – $200 | $120 – $180 |
| India | $20 – $50 | $20 – $50 | $15 – $40 |
| Canada | $120 – $160 | $120 – $160 | $100 – $140 |
| UK | $100 – $140 | $100 – $140 | $90 – $130 |
| Australia | $90 – $130 | $90 – $130 | $80 – $120 |
| Germany | $80 – $110 | $80 – $110 | $70 – $100 |
| Philippines | $20 – $40 | $20 – $40 | $15 – $35 |
| Ukraine | $30 – $50 | $30 – $50 | $25 – $40 |
| Brazil | $20 – $40 | $20 – $40 | $15 – $35 |
| South Africa | $30 – $50 | $30 – $50 | $25 – $40 |
Design Stages, Time to Design, and Cost
Designing a BNPL app requires detailed planning, prototyping, and testing. This table outlines each stage and its associated costs.
| Design Stage | Description | Time to Design | Estimated Cost |
|---|---|---|---|
| Market Research | Analyzing user needs, market trends, and competitor strategies. | 2–3 weeks | $2,000 – $4,000 |
| Wireframing | Crafting low-fidelity layouts for app structure and flow. | 2 weeks | $2,000 – $3,000 |
| Interactive Prototyping | Creating high-fidelity prototypes with clickable interactions for user feedback. | 3–4 weeks | $3,500 – $5,500 |
| UI Design | Implementing advanced UI elements like animations and transitions. | 3–4 weeks | $4,000 – $6,000 |
| UX Optimization | Ensuring smooth navigation through user journey mapping and testing. | 3 weeks | $3,000 – $5,000 |
Total Estimated Design Time: 13–16 weeks
Total Estimated Cost: $14,500 – $23,500
BNPL – Features, Time to Develop, and Cost
This table highlights essential and advanced features in a BNPL app, along with the development time and cost for each.
| Feature | Description | Time to Develop | Estimated Cost |
|---|---|---|---|
| User Registration/Login | Secure multi-factor authentication via email, phone, or social media. | 2–3 weeks | $3,000 – $5,000 |
| Installment Management | Flexible payment plans with adjustable schedules. | 3–4 weeks | $4,000 – $7,000 |
| AI-Powered Credit Scoring | AI-driven credit assessments using alternative data points. | 4–5 weeks | $6,000 – $9,000 |
| Fraud Detection System | Real-time fraud detection powered by machine learning algorithms. | 5–6 weeks | $8,000 – $12,000 |
| Virtual Cards | Issue virtual card numbers for secure transactions. | 3–4 weeks | $5,000 – $8,000 |
| Analytics Dashboard | Advanced analytics for users to track spending and manage payments. | 3–4 weeks | $4,000 – $7,000 |
| In-App Chat Support | Chatbot and live agent support for customer inquiries. | 3 weeks | $4,000 – $6,000 |
Total Estimated Development Time: 20–28 weeks
Total Estimated Cost: $34,000 – $54,000
Employing the Right Talent for your BNPL App
One of the essential processes of creating a Buy Now Pay Later (BNPL) application is selecting the right team of experienced developers. Your key to the app’s functionality, security, and usability is the choice of developers. Choosing a good team can help you turn an idea into a successful, fully complete app. Here’s a breakdown of how to hire the right experts and make sure your project runs smoothly.
1. Looking for BNPL App Developers with Fintech Skills
By their nature, creating these business applications demands profound knowledge of fintech processes. To develop digital publications, you need developers who understand the unique features of payment systems.
This also includes financial laws and security parameters. Having developers with experience in fintech will help them ensure that your application meets best practices. This will also work perfectly for the consumer.
2. How to Get the Best BNPL App Development Company
Creating a BNPL app only works for a few developers; it works for the team that understands all the processes involved in this activity. When you hire a Buy Now Pay Later app development company. You are getting a team that has worked previously and is sure they had great success.
3. Accounting for Portfolios and Customer feedback
When looking for a BNPL app developer or development company. Always try to make sure you can scrutinize their services via their portfolio and customer feedback. As a manager, it used to be like choosing fruits that are the ripest among all the fruits in the basket.
Therefore, it is crucial to sample the previous projects developed by the developers. They must have developed at least one Payment-related app or a Money-related platform.
4. Search for Good Communication as well as Interpersonal Skills
Suppose you are going to build a practical BNPL application. In that case, it is essential to know that the development process involves teamwork. This should have various aspects should be communicated.
Communication is vital to keep a project flowing, especially if you collaborate with a team you have never met face-to-face. Ensure that the developers or company you hired are approachable and easy to talk to when giving feedback.
5. Long-term Partnership
Creating an application for the BNPL is just the first step. Down the line, you will require patches, feature additions, and bug fixes to ensure your app is competitive. While hiring developers, one must consider the process beyond the developmental stage.
It would be wiser to cultivate a long-term symbiotic relationship with a team capable of growing your application.
Conclusion
Establishing a BNPL app effectively expands the organization’s share in the fast-growing deferred payment segment. The total cost of developing a BNPL app depends on the features aimed at it. And any experienced BNPL app development company will guarantee you long-term success.
The choice can be either White-label BNPL app development or tailored options. But, in both cases, emphasis should be put on the platform’s usability, resilience, and further scalability. Align with the correct team, like Shiv Technolabs, and prioritize the integration of BNPL for online stores. This will open the gate to business growth in the flexible payment era.
AI-powered BNPL apps provide seamless credit checks and risk management, ensuring secure transactions.
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