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Everything E-commerce Merchants Need to Know about BNPL Providers

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What You Need to Know

- Most if not all major Buy Now, Pay Later providers:

  • Pay merchants up front
  • Handle fraud and chargeback risks
  • Charge no interest to shoppers
  • Have no set-up or monthly merchant fees, instead charging on a per-transaction basis
  • Integrate with major platforms such as Shopify, WooCommerce, and BigCommerce
  • Provide access to a large network of consumers

- The cost of some BNPL providers depends on the specific e-commerce business

- Use Shypyard to help you handle the accounting data that arise with offering different BNPL options to your shoppers.

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Offering Buy Now, Pay Later—often shortened to BNPL—to shoppers has been a significant growing trend in e-commerce for a while now. If you would like to know more about the payment option before taking the leap and adopting it, check out our comprehensive guide on the subject.

If you have already answered "yes" to the if, the natural next question is how. There is nothing stopping a merchant from creating their own BNPL plan and collecting customer installments themselves. However, this will become impractical and messy as your business grows. As a result, it could be wise to choose a BNPL provider, a third party to mostly handle the work for you. However, how do you find a trustworthy, cost-effective, flexible BNPL provider amongst the hype and flood of advertisements? In this article, we will examine 6 major BNPL providers, breaking down their solution(s) & pricing(s), shopper experience, merchant experience, and notable partners & integration platforms. We will also offer our own insight on the best choice among the six.

After you decide on an ideal provider, you can start offering Buy Now, Pay Later to your customers. However, this means accounting becomes more complicated due to the increase in sales, customers, and merchant fees. This is where Shypyard can help. Shypyard offers seamless, crucial integrations between your accounting system and e-commerce platform, including automated inventory updates, sales order documentation, multi-channel support, error handling, and more. Shypyard can also help you record your store's BNPL transactions in a separate clearing account, to give you clarity into the benefit and costs of each BNPL channel. Click on this link to learn about how you can send fees applied to your store's orders to an accounting system to be listed as expenses.


Klarna, in our opinion, is the best BNPL provider. Not only does it offer multiple easy-to-understand plans and pricings, but it has a large global customer base that merchants can tap into. In addition, Klarna's checkout flow is faster than most of its competitors'.

BNPL Plan & Pricing

Klarna mainly offers three BNPl plans.

  • Pay in 4: Pay in 4 is essentially the standard BNPL plan — shoppers make one payment upfront and the remaining 3 payments are collected automatically every 2 weeks.
  • Merchant Fee: Up to $0.30 USD + 5.99% per transaction.
  • Pay in 30 days: Pay in 30 days allows shoppers to pay up to 30 days after a purchase, without interest or up front payments.
  • Merchant Fee: Up to $0.30 USD + 5.99% per transaction
  • Klarna Financing: The Klarna Financing feature allows shoppers to pay in monthly payments for 6-36 months, depending on their choice.
  • Merchant Fee: Up to $0.30 USD + 3.29% per transaction.


Klarna possesses pre-made marketing assets, such as On-site Messaging which lets an e-commerce store’s customers know about their BNPL payment options. Furthermore, Klarna swears on a frictionless, quick checkout experience for shoppers. Returning Klarna users have their billing and shipping address pre-filled in the checkout process, even if it is their first time purchasing from a specific e-commerce store.

Klarna has 90 million customers across more than 250,000 merchants in 17 countries.

Using Klarna

When Klarna is used for a payment, they assume all the credit and fraud risk while the e-commerce business is always paid in full, up front. E-commerce businesses are able to see an overview of shopper purchases made with Klarna, making it simple to manage orders, refunds, and disputes.

Partners & Integration

Klarna is used by brands including H&M, Adidas, and Sephora. Also, it integrates easily with Shopify, BigCommerce, WooCommerce, Stripe, etc.


PayPal, although not a pure BNPL provider, has an extremely large customer base. It is also the most convenient option for merchants already using PayPal as a payment provider.

BNPL Plan & Pricing

PayPal has two main customer financing options — Pay in 4 and PayPal Credit. Both features are included in PayPal Checkout, so merchants who already use PayPal as a payment provider can start leveraging them immediately. There are no additional costs, since the options are included in the existing PayPal rate.

Paypal’s Pay in 4 feature offers the typical interest-free BNPL option to shoppers. PayPal Credit lets shoppers pay for purchases larger than $99 USD over the span of 6 months. There is no interest as long as they pay in full before the 6 months end, although there is a minimum monthly payment amount and this option is subject to credit approval.


PayPal has the largest number of users out of all the BNPL providers, more than 300M, although not all of them regularly use its Buy Now, Pay Later feature.

After setup, PayPal's dynamic messaging—which can be added to an e-commerce store with a simple integration—will display the most relevant Pay Later offer to shoppers.

Using PayPal

E-commerce merchants are paid up front in both PayPal BNPL solutions.

Partners & Integration

PayPal claims to be rated as the most reliable Buy Now, Pay Later provider, and it is trusted by brands like Bed Bath & Beyond, Uniqlo, Champion, Aldo, etc.

To learn more about PayPal...see our guide on the payment provider.


BNPL Plan & Pricing

Shoppers make 4 payments over 6 weeks. The merchant fee is charged on a per-transaction basis: $0.30 + 3-7% of the purchase.


There are no external credit checks or application fees for shoppers. Afterpay approves around 90% of the customers that choose to shop using their service.

Afterpay has total of 13M+ global customers, a majority of which are millennials and Gen Z.

Using Afterpay

E-commerce merchants are paid up front, within days, when a purchase is made with Afterpay. They also have access to daily settlement reports that they can use to reconcile or certify orders. Meanwhile, Afterpay takes on risks like chargebacks and fraud for their e-commerce merchant partners.

Partners & Integration

Some partners of Afterpay include Wix, Shopify, BigCommerce, Stripe, and WooCommerce. All of them can enable a quick integration of Afterpay into an e-commerce store.


BNPL plan & Pricing

Affirm merchants can customize their BNPL solution. Besides the typical 4 interest-free installments paid every 2 weeks, Affirm allows merchants to lower monthly installment amounts and extend payment terms to up to 36 months. Affirm merchants can also unlock the 0% APR feature to offer interest-free payments to their customers.

A typical Affirm fee is 5.99% + $0.30 per transaction. However, the exact fee for each e-commerce business is dependent on factors like their business size, product type, risk profile, and Affirm program option. Affirm does not charge integration, annual, or monthly fees.


Affirm has no hidden fees, not even late fees, when it co\mes to their installment plans. Their Adaptive Checkout translates e-commerce product prices into suitable payment terms, from which customers can clearly learn what and when to pay.

Affirm is used by 6.2M+ shoppers.

Using Affirm

Affirm pays their merchants up front—within 1-3 business days of a purchase—and takes on chargebacks and fraud risks for merchants.

Partners & Integration

Affirm is available on Wix, Shopify, WooCommerce, and BigCommerce.

Zip (previously Quadpay)

BNPL Plan & Pricing

Shoppers using Zip pay 4 installments over 6 weeks. The per-transaction merchant fee is $0.15 + 2-4% of the total order.


Zip does no hard credit checks on its shoppers. In addition, it accepts all major credit cards, being the only BNPL solution that accepts not just Visa but also Amex and Discover.

Globally, over 8 million shoppers use Zip.

Using Zip

When using Zip, an e-commerce store is paid up front, in full. Merchants can manage customer data, purchase orders, and reconciliation in the Zip merchant portal.

Partners & Integration

Integrating Zip into an e-commerce store is a matter of “plug-and-play,” no APIs required. Zip can integrate with Shopify, BigCommerce, WooCommerce, WordPress, Magento, etc.


BNPL Plan & Pricing

Shoppers make 4 payments over 6 weeks, with no interest.

Sezzle’s per-transaction fee is determined by an e-commerce store’s product, business age, and other factors. A standard fee consists of: $0.30 + 6% of the purchase. Sezzle has no sign-up, set-up, or monthly fees.


Sezzle has around 1.8M consumers across the U.S. and Canada.

Using Sezzle

E-commerce merchants are paid up front, in full. Sezzle takes care of all fraud and repayment risk.

Partners & Integration

Sezzle integrates with Shopify, BigCommerce, WooCommerce, WordPress, Magento, etc.

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