Luke Chan / E+ / Getty Images

Mastercard enters the BNPL game as other players consider implementing it

The line between credit cards and ‘buy now pay later’ programs is getting blurry


Mastercard has entered the “buy now, pay later” market with its Installments program, providing cardholders with a new choice to pay both online and in-person.

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

Mastercard has unveiled its new “buy now, pay later” program – Mastercard Installments – giving consumers a new choice to pay in-person and online.

The program “enables banks, lenders, fintechs and wallets to offer a variety of flexible installment options to consumers – including a zero percent interest, pay-in-four model,” according to a Sept. 28 press release. In short, it enables customers to pay in equal installments interest-free, giving them an alternative to debit, credit or prepaid cards.

Shoppers can get preapproved via lenders’ banking apps or gain instant approval when they check out, and they can store the preapprovals in digital wallets to use wherever Mastercard is accepted.

“At the heart of it, payments come down to choice – and people want more from their money with greater flexibility and control in how they pay and where they shop,” said Craig Vosburg, chief product officer at Mastercard, in the press release.

Benefits of Mastercard Installments

The program offers not only consumer benefits, but it also provides merchants and lenders with perks, too:

  • Consumers can choose how and when to pay.
  • Merchants can gain a competitive advantage because, according to Mastercard, “BNPL solutions have been shown to increase average sales by 45% and reduce cart abandonment by 35% post-implementation.”
  • Lenders can offer this flexible program to new and existing customers to expand their lending opportunities.

Mastercard will still offer zero liability protection – unlike many BNPL programs – so consumers can rely on the security they have come to trust.

Where will Mastercard Installments be available?

Mastercard will roll out its Installments program in the U.S. first, followed by Australia and the UK. In the U.S., Mastercard is partnering with Barclays US, Fifth Third, FIS, Galileo, Huntington, Marqeta, SoFi and Synchrony, while in Australia it will work with Qantas Loyalty and Latitude.

An expert’s take on Mastercard Installments

Ted Rossman, senior industry analyst at, said the line between credit cards and BNPL is getting increasingly blurry.

For example, Mastercard’s new offering works with digital wallets and on retailers’ websites, he explained. At the point of sale, the consumer experience has a significant impact on whether the customer chooses to pay with a credit card or buy now, pay later. Ultimately, these are similar payment methods that offer people flexible repayment terms.

Many consumers are drawn to instant gratification, easy access and predictable installments, Rossman pointed out, and the blending of the physical and digital is a huge trend in retail.

BNPL companies have done a great job selling their solutions to merchants, Rossman said, even though they generally charge higher processing fees than credit card issuers. They have gotten merchants to buy in on a narrative that they sell more when they offer the programs to their customers.

“BNPL is poised for another banner holiday season, extending the e-commerce gains from last year and pushing deeper into the in-store experience,” Rossman predicted.

He also said the convergence of credit cards and BNPL should contribute to expected consolidation within the BNPL industry.

Rossman mentioned that  Square recently acquired Afterpay and Amazon announced a major partnership with Affirm (with rumors that Amazon might end up buying Affirm if it goes well, or perhaps will create their own BNPL solution).

In addition, Affirm has announced plans for a debit card, whereas traditional financial institutions such as American Express, Chase, Citi, Goldman Sachs, Visa, Capital One, Bank of America and Wells Fargo are in various stages of implementing or considering pushes into BNPL. PayPal is also looking to get in on BPNL, Rossman noted.

“We’re getting closer to a moment in time when BNPL could be considered less of a category unto its own and more of a common, everyday payment method,” Rossman said.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

Credit Card Rate Report
Cash Back

Questions or comments?

Contact us

Editorial corrections policies

Learn more