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'Buy now pay later' for travel? Here's what you should know

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Buy now pay later: A growing number of 'travel now, pay later' services are making immediate vacations possible these days. But what is it exactly and should one opt for it? Experts decode

'Buy now pay later' for travel? Here's what you should know
Call it pent-up demand or revenge tourism, the volume on the international side is back on track with customers coming out and willing to take a much-deserved break and travel. Now, even if they managed to save some money, travel expenses can quickly add up, and in such a scenario they can choose the ‘buy now, pay later’ option that’s being offered by many travel platforms.
But what exactly is this option and how it functions?
Commonly known as 'travel now pay later', it ensures that lack of savings is never an impediment in allowing oneself the luxury of the experiences that a holiday offers. With this one can travel first and pay the sum back to the offering platform later.
The travel providers offer flexible payments to their customers through vacation loans, said Akash Dahiya, Co-Founder at SanKash while speaking exclusively to CNBC-TV18.
And, how can one avail it?
Travellers can choose their package with associated travel partners available both online and offline and select payment options. They can then fill in the information for approval and the decision is declared instantly. Passengers will get booking confirmation or PNR from their travel partners.
After travel, passengers can pay in small, easy, amounts of the trip value.
Who should go for this model?
Buy now pay later (BNPL) in travels are more suitable for those individuals who don’t want to spend their savings, as after COVID we have seen people are keeping some liquid funds for their immediate needs. Hence these are gaining traction especially among the millennials, said Rohit Garg, CEO and Co-founder of SmartCoin while talking to CNBC-TV18.
How will it impact the travel industry?
Answering this, Dahiya said that this is sure to alter the travel industry in future.
“Most of us have taken impact on our salaries during pandemic and COVID is not yet over. So, now people are in save and spend mode. They are sceptical like if a new wave comes and again salaries are cut, what will happen? And, of course, everybody wants to travel. So, instead of using savings, it’s better to use travel now pay later as the buffer,” Dahiya said.
He added that this is going to stay in the travel industry.
“If somebody used to stay in a 3-star hotel during travels may now choose 5-star, considering COVID-19 protocols would be followed better there. And that has become possible with travel now pay later approach,” he said.
What are the things to keep in mind while opting for it?
Consumers should put in their knowledge and beware of frauds. They should be open to what interest they are going to pay and be cautious about fees and charges, Dahiya said.
“Also, they should remember that though they are paying per month price but in the long run they have to pay the full price. So, it’s better to be alert and not overconsume,” he advised.
Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.
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