What: A recent study conducted by Splitit and Pymnts reveals that installment plans linked to general-purpose credit cards significantly enhance sales and customer satisfaction in the retail sector. The research, titled "Divided, Not Conquered: Acquirer and Merchant Confusion Clouds Split-Payments Landscape," indicates a growing trend among merchants to adopt or improve their systems to accept these types of payments.

Why it is important: This shift towards installment payment options reflects a broader change in consumer payment preferences, offering benefits such as fewer declined transactions, quicker processing times, and increased transparency in payment processes. Notably, 76% of merchants anticipate a rise in consumer use of these installment plans, suggesting a demand for more flexible payment solutions that can lead to higher consumer spending and improved shopping experiences.

The Splitit-Pymnts study highlights the positive impact of credit card installment plans on both merchants and consumers within the retail industry. With 78% of merchants either planning to or currently enhancing their capability to accept installment payments, this payment option is poised to drive sales growth and elevate customer satisfaction. The findings underscore the importance of early communication about payment options to consumers, with 30% of merchants recognizing the need to inform customers about their payment choices at the beginning of the customer journey. As the retail landscape evolves, installment payment plans emerge as a key strategy for merchants looking to align with consumer preferences and achieve competitive advantage.

Credit card installment plans: a win-win for retail