Splitit Brings Out New Option for Debit Card Mobile Payments

May 4, 2018         By: Steven Anderson

For some people, installment payments are a great way to get the things you want today while paying for them gradually over the span of several weeks or even months. While some see this as a good way to pay way too much for the things you want, others see it as a way to make the best things in life more accessible. Splitit recently dropped word our way about its own new debit card plan that makes installment payments available even for things that didn’t have them previously.

With Splitit, the report notes, users can take purchases of under $400, and break these into three interest-free monthly payments routed through a debit card. This is actually a new step; previously, customers could use a credit card to split the payments into 12 equal installments. The move is expected to help businesses—especially those selling smaller items—generate more sales by offering greater options to customers.

Further, the report demonstrates how, in 2016, debit card transactions reached a monthly high of 23.6 transactions per active card, on average, demonstrating that customers are shying away from consumer credit, at least to a degree, instead actively looking to pay for purchases with cash on hand.

Splitit’s co-founder and CEO Gil Don noted “Merchants are looking for ways to empower their customers with more options to make their purchases feasible. Simultaneously, consumers, especially millennials, are interested in solutions that will help them better manage their cash flow….”

Incorporating an increasingly-used mobile payments technology to drive sales by allowing customers to readily split the bill into three smaller installments isn’t a bad plan at all. With no interest involved, it also means a better picture for the customer; many installment plans require a kind of interest, or at least a markup in the sales price to approximate interest. Just look at the difference in price on an Xbox One X console between Rent-A-Center and Best Buy; Best Buy’s price is $499.99 out the door. Rent-A-Center’s “Six Months Same-as-Cash Price” is over twice that at $1,079.57.

A simple, inexpensive way to make installment payments may prove welcome, though the $400 ceiling may prove a bit limited. Still, it’s a good start, and a way to make mobile payments even more attractive.