subscribe to our newsletter

Mastercard extends BNPL offering to lenders

The US payments giant has rolled out infrastructure allowing banks and lenders to offer buy now, pay later products across its network.

The new program, Mastercard Installments, will allow lenders and fintechs to offer their customers an additional buy now, pay later (BNPL) payment option across the Mastercard network in-store and online.

Mastercard has marketed the solution as a way for lenders to offer a seamless buy now, pay later (BNPL) experience without needing to integrate with merchant infrastructure and to expand their lending into a fast-growing consumer segment.

Customers will either need pre-approval through their lender’s mobile banking app to use Mastercard Installments or they will be able to access instant approvals at the checkout, through Mastercard’s digital wallet app Click to Pay.

Similar to other products in the segment, MasterCard Installments has a zero per cent interest model, with payments split into four instalments.


BNPL players will also be able to integrate Mastercard Installments’ application programming interface (API) into their own offerings, extending their reach beyond their existing footprint.

Ultimately, they’ll be able to skip making direct arrangements with merchants that already are plugged into the Mastercard network.

Australia is one of three launch markets for the product, alongside the UK and the US, with Qantas Loyalty and Latitude being its initial partners.

Latitude previously teamed with Mastercard to roll out its own BNPL product, LatitudePay – which was accepted across the payment giant’s network.

Speaking on Mastercard Installments, Richard Wormald, division president, Australasia at Mastercard commented: “Australians have always valued greater choice, security and convenience in the way they pay, so it’s no surprise that the country has been at the forefront of BNPL innovation.


“Mastercard Installments builds on these strong foundations, enabling local banks, lenders, fintechs and merchants to customise their own buy now, pay later model – providing new ways that work online and in-store, backed by the security and peace of mind that comes with a Mastercard transaction.”

Ahmed Fahour, managing director and chief executive of Latitude Financial added: “Through our long-standing relationship, Latitude is looking forward to working with Mastercard to bring new BNPL payment solutions to life in Australia, benefitting merchants and providing customers with a superior shopping experience.”

More lenders turning to BNPL

More and more lenders have entered the BNPL scene as US payments company Square has bought Afterpay for around $39 billion.

Suncorp recently declared that it would be launching a Visa-backed BNPL offering called PayLater in November.

CBA also launched StepPay earlier this year, while Westpac’s New Zealand arm entered into a joint venture agreement with BNPL provider humm group in July, rolling out a product called bundll to the Kiwi market.

Citi on the other hand will release its own rendition to the Australian landscape, called Spot., in October.

A NAB report in June showed BNPL became the fourth-most common debt held by Australians over the March quarter, retained by around 18 per cent of consumers.

However, an ASIC report in November last year found 22 per cent of BNPL customers prioritised their buy now, pay later debt over loan repayments or bills.

[Related: eftpos becomes first ID broker under digital ID framework]

Mastercard extends BNPL offering to lenders

If you have ever considered how you could better service your SME clients but lack the knowledge or confidence to do this beyond referring them on, this is a must-attend event for you. Don't miss SME Broker Bootcamp, a jam-packed, free-to-attend, practical workshop. Register today and secure your place at this interactive, flexible, must-attend event.

Sarah Simpkins

Sarah Simpkins is the news editor across Mortgage Business and The Adviser.

Previously, she reported on banking, financial services and wealth management for InvestorDaily and ifa.

You can contact her on This email address is being protected from spambots. You need JavaScript enabled to view it..

Latest News

An industry poll has been launched to understand the key issues impacting mortgage and finance industry professionals leading up to the 2022...

The mutual bank has confirmed that it has reached a milestone figure of $10 billion in assets. ...

The financial complaints body has recruited a new leader for its compliance and monitoring team. ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

Do you think APRA's bank buffer changes will see more borrowers use non-banks?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.