By Julie Muhn (@julieschicktanz)

Galileo has expanded its BNPL tool to allow banks and fintechs to offer cardholders post-purchase installment payment options.

The new feature works with firms’ existing debit and credit programs and allows consumers to select up to five historical transactions to move into a BNPL payment plan.

Galileo’s new offering is similar to UK-based Curve’s Flex feature that allows customers to move transactions into a installment repayment plans.

Payment processing platform Galileo announced it is expanding its Buy Now, Pay Later (BNPL) offering. The SoFi-owned company launched an API for its bank and fintech clients that will enable them to offer their cardholders post-purchase installment payment options.

The post-purchase repayment options, which work with firms’ existing debit and credit programs, allow consumers to select up to five historical transactions to move into a BNPL payment plan. Once the customer has selected the purchase or purchases they want to move to a BNPL plan, the bank or fintech presents them an offer, along with the terms of agreement. If the customer accepts the terms, Galileo validates that the transactions are settled and not tied to any existing installment loans, and creates the loan for the total transactions.

The post-purchase BNPL plans work differently for purchases made with a debit card than they do with a credit card. For transactions made with a debit card, the bank or fintech disburses the funds to the customer’s Galileo DDA or an external account. And with credit transactions, the payoff amount is shifted to the customer’s credit card payment due date in the agreed upon installments.

“This new offering bridges the gap between cards and loans and allows banks and fintechs to establish and deepen customer relationships with innovative, flexible financing options for both credit and debit customers,” said Galileo Chief Product Officer David Feuer. “By expanding pay over time opportunities, post-purchase financing is ushering in a new era of responsible lending.”

Galileo expects the new offering will help banks and fintechs differentiate themselves in a crowded marketplace, drive revenue through installment fees, and serve as a jumping off point for firms to enter into the lending space.

This isn’t the first time the fintech world has seen post-purchase BNPL. Curve, a UK-based fintech, offers a direct-to-consumer credit card with a feature called Flex that allows customers to select transactions they’ve made in the past year and move them into an installment repayment plan. Curve launched its credit card in the US in 2022, but has since paused new accounts in the region.

Galileo was founded in 2001 as a payment processing platform that allows third party fintechs and businesses to build and scale their own financial services offerings. The company was acquired by SoFi in 2020 in a US$1.2 billion deal. Earlier this month, Galileo inked a partnership with The Bancorp Bank to offer real-time payments.

https://finovate.com