As financially savvy consumers, Generation Z are light years ahead of past generations. As such, they’re fueling a revolution when it comes to the way they handle credit. According to Zilch CEO Philip Belamant, “It’s clear they have watched and learned from the mistakes of their parents and grandparents when it comes to credit and lending and as such are demanding a change.” Among the biggest changes are the Buy Now Pay Later (BNPL) companies that allow consumers to pay in installments without interest.
Generation Z expects and demands transparency in their business dealings, and that includes how they pay for items they purchase online. If industries want to keep up with this generation and future generations, too, they’ll need to make sure they’re up front about their fees, policies, and procedures. Companies that don’t offer that may get left behind, as consumers choose other options instead. With the availability of online purchasing, it’s relatively easy for customers to move to a different provider if needed.
With the BNPL opportunities that are appearing, Generation Z has a new way to purchase what they want and pay for it without exorbitant fees and high interest rates. The providers of these services need to be clear on what this generation wants, or they’re not going to be relatable or valuable. Talking about what digital natives are and how they work, along with what they need to feel comfortable in working with a particular company, can give BNPL businesses the opportunity to succeed more easily.
Who Are the Digital Natives?
Generation Z are those who are older than 13 but younger than 25. They’re the very first generation that grew up with technology, “digital natives” that don’t know what a world without it is like. Technology is completely natural to them, allowing them the opportunity to work with companies to be clear on what they want and need. They aren’t going to settle for companies they can’t trust, or those they don’t feel good about. They also aren’t interested in companies that want too much from them, because they know they can simply switch to a different company to get what they’re looking for.
But digital needs aren’t the only thing to address when it comes to Generation Z. They’re also interested in sustainable practices and caring for the environment. They know it’s important to look after the planet, and are more likely to work with people and companies who also see the value of that. Not only do they care about sustainability when it comes to the environment, but they look at sustainable business practices, as well. They don’t want business practices that have hidden issues and small print, and they’re much more likely to reject any companies that offer that.
Sub-par opportunities don’t work for Generation Z, and that’s true of all aspects of their lives. It’s especially true for their finances, where they’ve worked toward saving and spending responsibly. With that in mind, buy now pay later companies are focused on making sure their fees and terms are clear, direct, and easy to find. The BNPL companies, such as Zilch, understand the importance of making Generation Z feel comfortable in their buying habits and choices. When they do that, they give the generation the confidence to continue buying what they need and want online.
Generation Z Avoids the Credit Crunch
In 2008, the global financial crisis saw a lot of banks taking excessively large risks. Additionally, the housing bubble burst and the global economy took a hit. It took years for the markets and overall economy to recover from what happened during that time. Because of the serious issues that were faced then, Generation Z is now focused on avoiding those kinds of issues as much as possible. One of the ways they can do that is through not borrowing too much and not borrowing at high interest rates or with large fees. That’s where BNPL companies come in, and how they can help an entire generation get what they want safely.
A Shopping Revolution is Taking Place
Generation Z has learned from the mistakes of past generations, and is more likely to abandon traditional credit options. Instead, they want to see what they can get for a better price and on terms they can easily read and understand. Pages and pages of terms and conditions aren’t acceptable to this generation, and they’re not afraid to say so. When they use a BNPL service that’s designed with customers in mind, they have the ability to exert more control over their credit decisions and more easily take charge of their financial life. That’s important for the things they buy, how they save, and what they teach their children.
The streamlining of payments and the simplifying of life through BNPL opportunities give Generation Z the freedom to purchase the kinds of things they want and make sure they can afford them. They won’t need to spend a lot of money on interest charges and other fees, and they don’t have to worry about a mix of providers and a lot of different deadlines for payments. That can raise the risk that they’ll miss a payment, and with one buy now pay later companies they’re working with, the risk of that is much lower.
A platform that’s easy to use and reliable is the best way for any Generation Z member to coordinate their spending and the options they have for purchasing. Responsibility is a big part of the “new world” of credit, and companies like Zilch and its CEO Philip Belamant understand that making Generation Z comfortable is a way their businesses can continue to be more successful both now and in the future. Customers are no longer willing to accept hidden fees, high interest rates, and payment timelines that aren’t fair to them or don’t give them options and opportunities. As payment providers take their roles more seriously, they’ll also acknowledge that someone missing a payment is often the fault of the service provider and not the customer.