Instalment purchase and deferred payment are forms of financing in which the customer pays for the goods later or gradually, while the merchant receives the money from the financing provider. Commercially they make sense for higher-priced goods, where they increase the average order value and reduce the share of abandoned carts. The provider charges a commission, which reduces the margin, and takes on the risk of non-repayment. This constitutes the provision of consumer credit, so information obligations towards the customer apply, including a clear statement of the total costs. With deferred payment you also need to allow for a higher rate of returns, because the customer has not paid for the goods in advance. It is worth reading the contractual terms with the provider especially in the section on handling complaints and withdrawal from the contract.
See also: Payment gateway, Returns and their cost, E-shop terms and conditions.
