Second Chance Consumers “Deserve to be Trusted”


Up to 23% of American adults may need a “second chance” to access the low and affordable payments that a higher credit score would offer, with 59% of these saying they are “very” or “extremely” interested by taking steps to improve their credit.

For many, that has meant turning to buy now, pay later (BNPL), which 57% of second-chance consumers say is a viable method of improving their credit score, which means that merchants who offer BNPL are more likely to gain their customers. .

“These customers do not have traditional credit, but they are consumers who deserve to be trusted” Sezzle Director of Revenue Veronique katz told PYMNTS in an interview.

About 65% of all consumers say they see BNPL options as a way to buy something without spending too much, including over 70% of second chance consumers, according to a study conducted by PYMNTS in collaboration with Sezzle . Forty-eight percent of all consumers also consider BNPL companies to be more trustworthy than banks or credit card issuers, as do nearly 54% of second chance consumers.

See more : Study confirms romantic correspondence between BNPL and “second chance consumers”

“There’s this misconception that buy now, pay later is only for consumers who don’t have the option of shopping otherwise,” Katz said. “We see income levels everywhere, and no matter how much someone may earn, there is real value in being able to manage your money without paying interest and spread it out over a short period of time.”

According to research from PYMNTS and Sezzle, 65% of second chance consumers earn more than $ 50,000 per year and 30% earn more than $ 100,000. The average second chance consumer is 44 years old and has a FICO score of 662, just 38 points lower than a typical “good” credit score.

Katz said, however, that “the next-gen buyer isn’t always the millennial or the primary customer with established credit.” Sezzle tries to meet these consumers through Sezzle Up, a product that reports payment history to credit bureaus in order to increase a person’s credit rating.

“It’s really about trying to help consumers who need tools or help managing their money or to have access to credit for the things they need without putting them in long-term debt. “Katz said.


Even though BNPL is becoming more prevalent in the United States, PYMNTS data shows that 72% of second chance consumers have not used the payment option, and nearly a third say they are unaware of it.

Katz said awareness is growing rapidly as “friends tell their friends … and young consumers become a larger population group,” but there is still work to be done to build familiarity. Sezzle has discovered that corporate marketers are a great source of awareness for his products, as well as for social media and other marketing campaigns.

“We do a lot of different things, but one of the most important is probably to have more doors in the big merchant companies,” Katz said.

She added that the upcoming holiday shopping season presents a great opportunity for Sezzle and other BNPL vendors to bridge the awareness gap. Retail sales in the United States in November and December are expected to increase 7.4% from 2020 and 11.1% from 2019, with digital sales expected to increase 7.6% year on year and 57 , 3% compared to 2019.

Read more: Mastercard predicts 7.4% retail growth over the holiday season

And with consumers keen to ensure gifts arrive on time as supply chain challenges persist, many are starting their holiday shopping earlier than in previous years, potentially opening the door to use. BNPL as a budgeting tool.

“If you thought you normally save for your holiday shopping in December, and now you plan to do it a month to two months early, you might need that little extra wiggle room for your shopping,” Katz said.

It mostly boils down, she said, to helping put up guardrails to keep consumers from overspending.

“We are focusing on the consumer who may not be in the credit funnel,” Katz noted. “Maybe they’re going through a tough time and fixing their credit, but they have the capacity to pay it back. And I think our mission to financially empower the next generation is very clear. “

See also: Sezzle files draft documents for U.S. IPO



On: Forty-seven percent of U.S. consumers avoid digital-only banks due to data security concerns, despite considerable interest in these services. In Digital Banking: The Brewing Battle For Where We Will Bank, PYMNTS surveyed over 2,200 consumers to reveal how digital-only banks can boost privacy and security while providing convenient services to meet this unmet demand.


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