The supermarket giant has agreed to a partnership deal with the BNPL industry leader Klarna and shoppers will be able to opt for the payment method across three of its brands – these include Argos, Habitat, and Tu Clothing
Sainsbury’s will allow customers to use buy now pay later (BNPL) when they shop online at some of its major brands.
The supermarket giant has agreed to a partnership deal with the BNPL industry leader Klarna and shoppers will be able to opt for the payment method across three brands in Sainsbury’s portfolio reports RetailWeek. These brands include Argos, Habitat and Tu clothing at Sainsbury’s. Sainsbury’s acquired Argos and Habitat in 2016 as part of Home Retail Group in a £1.4billion deal.
Buy now, pay later is a payment option which allows you to either split payments into regular interest-free instalments or pay in 30 days time, rather than pay upfront. The use of BNPL has risen over the last few years however it has sparked a lot of controversy as many commentators argue that many who use the payment option do not realise it’s a debt, or the significant repercussions if that debt is not paid.
Sainsbury’s has recently focused on its food first strategy however, in its latest trading update from April it reported that its general merchandised sales had risen by 1.2%. The group noted that it had transformed Argos’ operating model in recent years which had created a much “more resilient business”. At the time, chief executive Simon Roberts Argos remained a “much-loved brand” and was three times more profitable than it was three years ago. Even though it reported a 6.4% dip in clothing sales, Sainsbury’s boss said he was confident about its trajectory for the year ahead.
Klarna reports that it now has around 35,000 merchants offering its buy now pay later service at checkout in the UK. It also reports that around 20million people use the payment method – up from 18 million last year. The company’s chief commercial officer David Skyes said Argos, Habitat and Tu were trusted “British icons” and this made Klarna a “seamless fit”.
He said: “More than 20 million Brits already use Klarna and now they can enjoy our flexible payment options at more of their favourite stores. Argos, Habitat, and Tu are British icons known for reliability and value, making Klarna’s interest-free payment solutions a seamless fit. We’re super-excited for this first step in our partnership with Sainsbury’s.” The Mirror has approached Sainsbury’s for comment.
