How does buy now, pay later work?
At checkout the customer chooses the BNPL option and is sent to the provider, which identifies them and makes a credit decision in seconds. If approved, the customer usually pays the first instalment straight away and the order is authorized. The merchant then captures the payment when the order is confirmed or shipped, and the provider pays the merchant the full amount minus its fee. Capture windows vary by provider: Stripe’s documentation, for example, gives 28 days for Klarna and 13 days for Afterpay to capture the balance after authorization.
Why does it matter?
Spreading the cost of larger purchases helps customers who would not pay the full amount at once, and the merchant is paid in full without carrying the credit risk. As an illustrative example: a store selling electronics in the UAE adds a BNPL option for orders between 500 and 5,000 dirhams. If 12% of customers in that range choose it and some of them would otherwise have left, the gain shows in checkout conversion for those baskets, against a higher fee on each BNPL order.
What are the trade-offs?
Fees are usually higher than cards, the provider declines customers it will not lend to, and amount limits apply. Split shipments and late captures need care, because uncaptured authorizations expire or are captured automatically by some providers. Regulation is tightening in several markets, which can change how the option must be presented.
Where does Omno use it?
Omno shows BNPL methods in the hosted checkout like other local methods, with eligibility rules by country, currency and amount, and reports their asynchronous statuses by webhook. The routing-decision log records every status change.