Fintech firm targets young consumers with ‘buy now, pay later’ service
Singaporean fintech company Atome is adding more digital payment gateway partners and lifestyle brands in Thailand to take a larger share of the country’s rapidly expanding “buy now, pay later” (BNPL) services, which are especially popular with young consumers, it said.
Poompong Tancharoenphol, general manager of Atome (Thailand), told reporters on Thursday that the company will increase the number of merchant partners from over 1,300 to 2,000 by the end of this year, as well as increase the number of brands it covers.
Atome will also add more payment gateways for merchants to access its service, he said, adding that it will increase marketing efforts to raise awareness about it. This, he claims, will help build trust among Thai consumers, who are increasingly concerned about online scams.
"We are one of the few purely BNPL services in Thailand, and we are the number one BNPL provider in both the country and the Asean region. Atome is now present in eight countries: Singapore, Indonesia, the Philippines, Malaysia, Vietnam, Hong Kong, China, and Thailand,” Phoompong said.
BNPL is not a new payment method, but it became more popular when the Covid-19 pandemic forced more people to quickly adopt digital technology, including digital payments, he said.
He described BNPL as a type of short-term financing that allows customers to make purchases now and pay for them later. Consumers, financiers, and merchants are all involved in the method, which is generally structured like an installment payment plan.
The company has about 750,000 users in Thailand and total sales reached 1.5 billion baht in 2022, its first full year of operation here, Phoompong said.
According to the e-Conomy SEA 2022 report, digital spending is expected to increase by 12% in Thailand by 2025 as a result of favourable policies from the Bank of Thailand. BNPL is one of the fastest growing digital payment options, the report said.
Thailand's real-time payment transaction volume reached 9.7 billion times in 2021, the third highest in the world after India and China, according to the report.
It is estimated that from 2021 to 2028, BNPL in Thailand is expected to grow by 16 fold, from $893 million to $16 billion.
Poompong admitted that BNPL can trigger excessive spending. To avoid bad debts, he said that the company planned moderate annual growth.
Despite its disadvantages, he insisted that BNPL is a good payment option, particularly for people who have just started their first jobs and have to restrain their desire to buy some products or services because they can't afford them with a single payment, Poompong said.
He gave examples that ranged from dental work, to sneakers and hotel reservations.
"Atome will divide the payment into three installments and collect the fee from the merchant. The percentage fee will vary according to the type of business. However, the average is around 6%. The system will send a notification a day before withdrawing money from users' credit or debit card," he explained.
However, if users fail to pay their bills for the first time, the system will block them and the debt collection department will take over, he said.
The most popular products that Atome users paid via BNPL can be divided into five categories: beauty, fashion, travel, lifestyle, and home decorations.
Poompong said that the company's ultimate goal in Thailand is to be a financial superapp that provides full access to finance and money management services.
Atome is one of Singapore's first unicorn fintech startups. The company has 30 million users in the countries it operates in. Its total revenue was $3 billion in 2022.
