Buy Now, Pay Later enters the HVAC chat

Offering homeowners a mix of payment options isn’t new, but a recent industry survey highlighted that Buy Now, Pay Later (BNPL) has joined the conversation.

Buy Now, Pay What? Primarily used in online retail, BNPL is a form of credit that allows consumers to split a transaction into smaller, interest-free installments (usually) over a six-week period. 

And it’s growing fast — between 2019 and 2021, the volume of BNPL loans originated from leading US providers grew over 1,000%, from $2 billion to $24.2 billion.

How it works: Consumers undergo a “soft credit pull” — which doesn’t impact credit scores — before making a down payment on the purchase, and then make three more payments over the next six weeks. Merchant fees typically range from 3-7%, comparable to industry lenders.

What about HVAC? Like other business trends, it’s trickling into home services. In 2020, HomeAdvisor made the first move by partnering with Affirm to allow homeowners to use BNPL for projects.

Beltz Home Service, a contractor in Ohio, took notice and now offers it to customers, too. “Buy Now, Pay Later is an exponentially growing platform of all age groups and economic demographics alike”, said co-owner Lara Beltz.

What to watch for: BNPL seems well-positioned to become a popular financing option in home services — especially as E-commerce grows and homeowners make HVAC purchases online.

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