HSBC rolls out installment offering as UK BNPL competition heats up

The news: HSBC rolled out a point-of-sale (POS) installment offering called Flexipay in the UK, per Finextra. The loans offer a fixed interest rate and monthly payments over a range of repayment periods.

• The offering launched with energy company Ovo. More merchants plan to offer it in 2025.
• Customers will be able to manage their plans and make payments through the HSBC UK banking app.

Why it matters: BNPL competition is heating up in the UK.

• Earlier this month, Affirm entered the market with its interest-free and interest-bearing buy now, pay later (BNPL) options.
• American Express also launched its “Plan It” card-linked installment offering in the UK this year.
• And other more established BNPL players in the country have also been expanding their operations. UK-based Zilch rolled out “Pay over 3 months” earlier this year for larger-ticket purchases.

Our take: HSBC’s entry into the UK BNPL market won’t be without difficulty.

• It faces steep competition from more established players like Zilch and Block-owned Clearpay as well as newer entrants like Affirm.
• It’s also entering the market during a period of slowing user growth as the BNPL boom fades.

HSBC will need some big-name merchant partnerships in 2025 to catch up to BNPL incumbents and make inroads in the market.

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