Asaf Darash, the CEO of Regpack, a platform for online payment management, believes that service-based businesses can turn their unique time and space limitations into advantages in the realm of payments. By recognizing the strong connections between service providers and consumers, businesses can implement European style Buy Now Pay Later (BNPL) installment plans to increase revenue and enhance financial stability. This approach leverages the inherent trust and familiarity between service providers and clients to create innovative payment tools tailored specifically for service-based businesses, potentially reducing risks associated with non-payment and fraud.
One example that showcases the effectiveness of leveraging the relationship between service providers and clients is the payment for children’s education, where the close connection between school and parents nearly guarantees payment. This bond can be harnessed to design custom payment plans that suit service-based businesses, mitigating risks such as non-payment and account receivables. By optimizing payment structures through installment plans inspired by BNPL options, service providers can establish secure and risk-free transaction environments that prioritize the unique characteristics of their services.
While the BNPL market in the U.S. was valued at $1.64 billion in 2022, service-based businesses have not fully tapped into this trend compared to product-based businesses. Implementing installment plans that function as auto-bill mechanisms rather than loans can effectively divide costs over time, eliminating the need for extensive credit checks and risk assessments. These structured payment plans, combined with the familiarity between service providers and clients, can enhance customer satisfaction, foster loyalty, and strengthen financial stability for service-based businesses, positioning them at the forefront of innovative payment solutions in the market.
By offering customers the option to pay ahead of the service, businesses can secure payments, increase revenue, and improve financial stability. Customized installment plans that align with specific service offerings, leveraging the close relationship between service providers and clients, can further reduce the risk of non-payment. These tailored payment solutions empower service-based businesses to address their unique challenges effectively, positioning them at the forefront of innovative payment solutions and enhancing their competitiveness in the market.
In conclusion, service-based businesses should not be limited to traditional payment models applied to eCommerce. Embracing their time and space limitations as opportunities, businesses in the service industry can create innovative payment options that capitalize on the strong connections between service providers and consumers. By adopting highly customizable payment plans inspired by European BNPL solutions, service-based businesses can effectively address payment challenges, enhance customer loyalty, and drive revenue growth in a competitive market landscape.
