British FinTech platform Butter launches BNPL industry-first initiative

By Gaia Lamperti

The ‘Buy Now, Pay Later’ (BNPL) industry continues its expansion in the UK. British BNPL platform Butter, has announced the latest evolution of its consumer-first offering with the introduction of Butter X a payment program with 6 and 10-month instalment options. This is the longest repayment term currently available across BNPL platforms, an industry first that is establishing Butter in the sector next to other giants such as Klarna and Afterpay.

The British FinTech platform is a BNPL travel agency, providing a flexible, cost-effective way to book travel and that now boasts 250,000 users, It was the first BNPL provider to become FCA regulated in 2017 prior to its launch and, since then, its solutions have enabled customers to spread the cost of purchases across every vertical, without requiring a technical integration.

As a registered travel agency, Butter already offers consumers the option of spreading payment instalments for their holidays over 2,3, or 4-month periods, with full payment not due until after the trip.  But the new Butter X feature, which is via app, interest-free and without the limitations of check out integration, will allow consumers can take advantage of a much longer payback offering across any purchase made via online checkout.

“Providing the options to spread payments for six or 10 months is unheard of within the BNPL space but we believe it will further enhance our offering and so it was a natural path of progression for us,” Butter’s CEO and Co-Founder, Timothy Davis, commented. “Our mission has always been to evolve the Butter offering with the consumer at the heart of what we do, whether it be responsible lending, interest-free repayments, more choice, or a greater level of flexibility.”

Butter has also pioneered a unique credit decisioning process with affordability at its core, utilising open banking and machine learning to ensure that lending is responsible and that customers are only able to borrow amounts based on what they can afford. Popular stores in the Butter app include Amazon, Argos, BooHoo, ASOS, H&M, Zara, Hugo Boss, Sports Direct, AirBnB, Currys PC World, Ao.com, IKEA and more.

“We’re proud to be pioneering yet another first within the UK BNPL sector and one that should bring a further level of flexibility and affordability to Butter users,” Davis concluded.

The platform recently raised £15.8 million via BCI Finance, the credit arm of London-based venture builder Blenheim Chalcot, as well as a number of other private Angel investors, to accelerate the rollout of its responsible open-banking based BNPL shopping app.

‘Buy Now, Pay Later’ programs allow customers to purchase expansive items straight away with smaller payments over time, generally enabled through third-party financial technology companies. Unlike credit cards, BNPL loans are linked to specific purchases and need to be paid off in a set number of instalments with no or minimum interest. The sector is undergoing steep growth in recent times, attracting remarkable valuations and acquisitions.