Complete Guide of Buy Now, Pay Later in Malaysia [2023]

Introduction of Buy Now Pay Later Malaysia

For most business owners out there, if you’re not familiar with What is Buy Now, Pay Later, Buy Now Pay Later aka BNPL is a credit plan that lets customers buy now and pay later.

What Is Buy Now Pay Later (BNPL)?

BNPL is designed to help customers who have no credit cards from banks & yet are still able to purchase products/services using BNPL services for installments with 0% interest! This service work essentially like a credit card, however, users’ purchases are split into monthly installments with a pre-determined tenure offered by BNPL service providers. On top of that, it is similar to credit cards, you will be charged late payment fees if you don’t pay up in time, and these charges differ depending on the platform.

Unlike the traditional ways of how credit cards application is, BNPL services tend to be easier for users to apply, most of them just need a picture of your IC and some regular details such as Full Name, Email, Phone Number and etc to verify your application. BNPL service providers usually do some soft credit checks and based on that information provide users their maximum credit limit for them to shop online or purchase in retails that support buy now pay later.

While this helps to remove the traditional lengthy process of credit card application which required to submit documentation like pay slips, bank statements, employment info, and more. Furthermore, a credit card application has some requirements to be met, for example, there is a minimum salary for banks to approve your application! This is why Buy Now Pay Later is getting more attractive lately – A totally re-inventing financial service offering to consumers today.

For consumers, users and merchants, we’ve compiled a full list of BNPL services in Malaysia as of 2022 by noting down their credit limits, payment tenures, late fees, and partnered merchants.

1. Atome Malaysia

For Consumers:

Atome Malaysia is one of SEA’s largest Buy Now, Pay Later (BNPL) platforms – Operating countries included Singapore, Malaysia, Indonesia, Hong Kong, and Mainland China. It has partnered with over 2,000 retailers online and in-store. To use their BNPL service, customers must be at least aged 18 and spend a minimum of RM10 for a single purchase. Installments are spread out across three months.

Credit limit: RM1,500 for non-credit card users, and RM5,000 for credit card users.

Payment tenure: Maximum Three months.

Late payment fees: RM30 per late payment (penalties are capped at RM60 per purchase).

For Merchants:

Per Transaction Fees: 6%

Integration & Setup Cost: Free

Benefits: List merchant’s store in their apps, Atome Vouchers for New/Existing Users & Seasonal Offering Campaigns.

2. Pace. Malaysia

For Consumers:

Pace. Malaysia is one of the growing startups located in Singapore for Buy Now, Pay Later (BNPL) platforms – Their BNPL service is rapidly growing in Singapore & Malaysia with their ease of use of the mobile application and low barrier of entry.

Credit limit:  Maximum RM3,000, but including features of purchasing item higher than the limit with 1st-month repayment higher and divided equally for next 2 months.

Payment tenure: Maximum Three months.

Late payment fees: Late payment fee of RM10, and a further MYR1 per day if the payment remains unpaid after the due date. For above RM40 purchases, the late payment fee is capped at RM60.

For Merchants:

Per Transaction Fees: 4%

Integration & Setup Cost: Free

Benefits: List merchant’s store in their apps/websites, Pace. Vouchers for New/Existing Users & Seasonal Offering Campaigns.

3. Hoolah Malaysia

For Consumers:

Hoolah Malaysia is one of Asia’s leading Buy Now, Pay Later (BNPL) platforms – Their BNPL service operates in Singapore, Hong Kong & Malaysia. Many local Malaysia Brands are using them on their e-Commerce based websites to drive more sales.

Credit limit:  Maximum of RM1,500 for all users – based on user assessments.

Payment tenure: Maximum Three months.

Late payment fees:  It is dependent on your order amount. For example,

• For purchases of RM0 to RM99.99, the penalty is RM7.50;
• For purchases of RM100 to RM499.99, the penalty is RM25;
• For purchases of RM500 and above, the penalty is RM75.

For Merchants:

Per Transaction Fees: 5.95% and RM1.50 fixed fee.

Integration & Setup Cost: Free

Benefits: List merchant’s store on their website, Vouchers for New/Existing Users & Seasonal Offering Campaigns.

4. myIOU Malaysia

For Consumers:

myIOU Malaysia one of the local fintech startups in Malaysia, has Yuna on board as its brand ambassador. In addition, myIOU is also a public listed Malaysian fintech company on the Australia Stock Exchange (ASX) that launched by IOUpay

It ​​​​offers tenures of two, three, or six months, which is more flexible compared to other BNPLs listed on our list here.

Malaysians aged 18 years and above with access to a local debit or credit card can register for an account.

Credit limit: An initial limit of RM1,000 which can be increased to RM10,000 by applying for myIOU Credit+, with terms and conditions.

Payment tenure: Two, three, or six months.

Late payment fees: RM5 or 1% of the outstanding amount per late payment (whichever is higher).

For Merchants:

Per Transaction Fees: Ranging from 4% to 8% depending on payment tenure by consumers.

Integration & Setup Cost: Free

Benefits: List merchant’s store on their website, Vouchers for New/Existing Users & Seasonal Offering Campaigns.

5. PayLater by Grab Malaysia

For Consumers:

PayLater by Grab Malaysia is one of the giant super app companies that join the latest BNPL fintech game. It was launched back in 2019 with a more unique approach compared to other BNPL functions.

Users can either pay in four monthly installments (PayLater) or pay the entire amount at the end of the next month (PayLater Postpaid).

PayLater & PayLater Postpaid can only be used for Grab services, such as Grab rides, GrabFood orders, GrabMart, and GrabExpress deliveries.

On top of that, because it is Grab – users can earn GrabRewards points earn when using this payment method online or offline!

Credit limit: Based on user assessments

Payment tenure: four months or paid off with one lump sum.

Late payment fees:  PayLater account will be frozen for each missed payment for users opting for an installment plan & the reactivation fee is RM10. 

For Merchants:

Per Transaction Fees: PayLater with 6% and PayLater Postpaid 8%

Integration & Setup Cost: Free

Benefits: List merchant’s store on their app, Vouchers for New/Existing Users & Seasonal Offering Campaigns.

6. SPayLater by Shopee Malaysia

For Consumers:

SPayLater Launched at the start of 2021 which is another giant super app like Grab that jumped into the BNPL scene. However, it is only available to select Shopee users and it is unclear what criteria are used for eligibility.

SPayLater can be used on purchases with a minimum value of RM15! This service offers two repayment methods. You can either pay the entire amount at the end of the month (interest-free) or pay installments across two, three, or six months.

Those opting for the installment plan will need to pay a 1.25% processing fee on their order amount each month.

Credit limit: Based on user assessments.

Payment tenure: One lump sum at the end of the month or installments across two, three, or six months.

Late payment fees: 1.5% per month of the overdue amount.

For Merchants:

Only Available for Merchants on their e-commerce marketplace, suitable for resellers, startups, and SMEs that are selling on Shopee.

7. FavePayLater Malaysia

For Consumers:

Here come another famous lifestyle app and e-wallet in Malaysia – Fave which also has a BNPL service that launched in 2021 for users to split their payments using FavePay. In addition, customers potentially earn up to 10% cashback with every FavePay Later purchase. As for now, FavePay Later is only available to all Fave merchants in Singapore and Malaysia for customers to shop with.

Credit limit: Based on user assessments.

Payment tenure: Three months.

Late payment fees: 1.5% of the outstanding payable amount per late payment after 7 days.

For Merchants:

For more information, can check with their business development team on FavePay later website. We will update the information once we have it.

8. Split Malaysia

For Consumers:

The one and only Malaysia’s first Shariah-compliant BNPL platform, Split, is the only BNPL service that doesn’t charge any late payment fees after its three-month installment plan.

Local-based startup platform which already works with tons of local merchants including Machine, Dyson, Samsung, Switch, and more.

Credit limit: Based on user assessments.

Payment tenure: Three months.

Late payment fees: None until now.

For Merchants:

For more information, can check with their business development team on Split website. We will update the information once we have it.

9. Rely Malaysia

For Consumers:

Rely is a Singapore-based fintech company with BNPL service which provides a unique shorter installment plan compared to other BNPLs on the list.

Instead of monthly installment plans, Rely offers 4 interest-free payments that are due every two weeks. Rely also has about 60 partnered merchants in Malaysia including HERMO, JD Sports and more.

Credit limit: Based on user assessments – debit cards users have a transaction limit of RM1,000, while it’s RM4,000 for credit cards.

Payment tenure: Two months (paid each 2 weeks).

Late payment fees: RM1-RM40 depending on your transaction amount.

For Merchants:

For more information, can check with their business development team on Rely Malaysia website. We will update the information once we have it.

10. PAYLATER Malaysia

For Consumers:

PAYLATER is a Malaysian BNPL service launched in late 2020, and you might be confused with PayLater by Grab that we mentioned earlier.

They had partnered with local well-known tech brands, such as Oppo, Gamer’s Hideout, DirectD, and more.

Their default tenure to settle your installments is four months, and users can request extended tenures such as:

• Up to 6 monthly installments for purchases of RM999.99 and below;
• Up to 12 monthly installments for purchases of RM1,000.00 and above.

Credit limit: Based on user assessments.

Payment tenure: Four, six, or twelve months.

Late payment fees: RM10 for every 7 days of late payment.

For Merchants:

For more information, can check with their business development team on PAYLATER Malaysia website. We will update the information once we have it.

11. Mr Pay Later Malaysia

For Consumers:

Mr Pay Later is yet another Malaysian BNPL platform that allows users to split their payments over two or three months.

Their six-month installment plan is available for selected merchants only. However the downside of this, they don’t have a dedicated app for users to sign up or use unlike the other BNPLs on the list.

This is a fairly new startup company for BNPL in Malaysia with currently partnered with 20 merchants only.

Credit limit: Based on user assessments.

Payment tenure: Two, three, or six months.

Late payment fees: Unclear – to be updated soon.

For Merchants:

For more information, can check with their business development team on Mr Pay Later Malaysia website. We will update the information once we have it.

Advantages of Buy Now, Pay Later in Malaysia:

Buy now pay later is a great way to not have to worry about paying for your purchase immediately. It allows you to buy the item and pay for it over a period of time. This is great for people who want more time to think about their purchase or those who are short on cash but still want those products/services!

Major advantages of buy now pay later Malaysia:

• Break purchases into manageable payments. The customer does not have to worry about paying the full price upfront, which can be hard for some people with tight budgets.
• 0% interest instalments. Most BNPL platforms offer 0% interest on your purchases. This means that you don’t have to pay any interest or fees – unless you miss a repayment.
• For merchants, with less barrier of entry for consumers with manageable repayment for their purchases with them, this helps to boost more sales!

Disadvantages of Buy Now, Pay Later in Malaysia:

Although BNPL financial services seem to be attractive and good in most cases, there are some disadvantages of this type of financing.

• High Late Payment Fees. Most BNPL platforms will charge you a fee if you can’t pay your installment. Depending on which BNPL service providers, you might end up paying more expensive than using a credit card.
• Hurting Your Credit Score If You Miss Repayments. Some BNPL service providers will report your missed repayments to credit reporting agencies – this will hurt your credit score.
• Tendencies To Spend More. BNPL platforms make it easier to buy things you might not able to otherwise be able to afford if you had to pay for them in full, or if you hadn’t budgeted for them. However, this can be useful for things that you need urgently, it also makes it easier to spend – impulse purchasing habits!
• High Service Fees Depending on BNPL Provider. For merchants, you will need to pay from 4% to 10% service fees for each transaction depending on your BNPL service providers.

Conclusion – Should You Use Buy Now Pay Later (BNPL) Option For Your Business?

With the growth of Fintech in Malaysia, Buy Now Pay Later is one of the most popular payment methods now in Malaysia & most of them are promoting New User Sign Up benefits for your customers which will help you to boost sales without incurring any extra cost to your business or as a merchant.

To Answer Your Question – Should You Use BNPL For Your Business? Yes! With all the benefits & almost hassle-free setup with multiple platforms such as Woocommerce WordPress, Shopline, Shopify, and more e-Commerce websites, there is almost little to zero effort to implement!

In addition, check out our promotion strategy that helps you to improve your e-commerce website conversions through a coupon marketing strategy

If you are looking for a website development that can help you implement Buy Now Pay Later platforms and design a stunning e-commerce-based website – Look no further, we are here to help! Just contact us today and get a free quote!

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