A guide to buy now, pay later for luxury clothing and fashion retailers

Last updated August 2022

When it comes to shopping for clothes online, there’s no one-size-fits-all payment solution. Customers have a wide range of tastes, needs, and shopping habits – and they need options in the checkout that can match. 

Buy now, pay later for clothing and fashion isn’t a trend – just like the little black dress or a pair of Chuck Taylors, it’s a staple that belongs in every retailer’s space (especially when it comes to the luxe and high fashion market). 

As well as giving your customers flexibility and control over the way they pay for their new clothing, having a buy now, pay later option in your checkout will put you in a competitive position and support your goals for growth.

Here we explore how buy now, pay later works in the luxury clothing and fashion industry and look at ways it will add value for your customers and your business. 


How buy now, pay layer works in fashion

Buy now, pay later has been a part of the clothing and fashion industry since the very start – mom and pop shops and huge department stores alike have offered credit-based payment plans since the early days of retail. 

For modern shoppers, buy now, pay later platforms bring this concept into the high fashion e-commerce checkout. Rather than paying upfront via credit or debit card, customers pay for their clothing in a series of installments over time.

There are a few different ways that buy now, pay later can show up on a clothing or fashion website. It usually goes something like this:

  1. Customers do their thing, shop their way across your website and add their items to their cart
  2. At the checkout they’ll see a buy now, pay later option, alongside your existing payment setup (with a white-label platform like Splitit, you can integrate the buy now, pay later option into your existing checkout flow, under your own brand)
  3. If they choose to buy now, pay later, customers will select a plan to pay for their clothing over a series of installments (usually bi-weekly or monthly) 

Point-of-sale buy now, pay later platforms are structured to enable customers to pay for their clothing via regular installments.

Finance-based buy now, pay later

Some buy now, pay later providers (like Klarna and Affirm) operate on a finance-based model, which means customers need to apply by submitting an application for credit or financing before they’re approved to complete their purchase. They’ll typically need to:

  1. Navigate away from the retailer’s checkout and onto a third-party site
  2. Enter their personal information (including their Social Security Number) and submit to a soft credit check
  3. Find out instantly whether they’ve been approved
  4. If approved, redirected back to the retailer’s site to pay for the first installment of their purchase

Some providers will charge interest on the payments, along with fees or penalties for missed payments. Many finance-based buy now, pay later platforms will also require customers to hand over their data to providers for marketing purposes. 

Existing card-based buy now, pay later

Splitit’s buy now, pay later model is the only installments platform to offer a payment solution where customers can leverage their existing credit card to split their purchase into smaller monthly payments. 

This means they don’t need to undergo a credit check or take out a new line of credit. They will:

  1. Enter their credit card information directly into the checkout page of your site. 
  2. Select the number of monthly payments to suit their budget.
  3. They must have the full balance available at the time of purchase, but they’ll only be charged for the first installment.
  4. Payments will be charged to their credit card in monthly  installments until the entire balance has been paid in full.
  5. Customers won’t pay any interest or additional fees (apart from any potential interest or fees that are already associated with their credit card).

Customers can also collect credit card points and rewards on their purchase through Splitit. 


Benefits of buy now, pay later for clothing and fashion retailers

Buy now, pay later offers a huge host of benefits for customers and retailers alike: people who are shopping for clothing can pay flexibly in a way that fits their budget, and fashion retailers can satisfy consumer demands within the highly competitive clothing e-commerce space. 

Having a diverse range of payment solutions allows you to cater to different consumer profiles, grow AOV, attract new customers, and support retention. It’s a perfect fit for retailers that carry high-value fashion items and want to make it possible for different consumer profiles to access luxury products.

Mitigate credit risk for customers

Splitit’s existing card-based buy now, pay later platform allows customers to access a flexible payment option without having to submit to a credit check or take on an additional source of credit. 

This is a huge draw for people who are reluctant about adding to their credit profile but want to express themselves by wearing high fashion items and are looking for a more manageable way to pay for their clothing. 

By enabling customers to pay in installments using their existing credit card, you’re able to offer a solution on your site that helps them to make a purchase while avoiding third-party financing.   

Drive higher conversions and AOV

You’ve probably noticed the rise of buy now, pay later in your competitor’s checkouts – and that’s because modern customers want to see it: 35% of shoppers are more likely to convert if they have the option to pay in interest-free installment payments. 

Splitit alone drives an average 30% conversion rate improvement. As well as boosting sales, buy now, pay later platforms give customers more control over when and how they pay – meaning they have a new way to budget and make decisions while shopping for clothing. 

Splitit’s average order value is over $1,000 USD, which is four times higher than other finance-based buy now, pay later providers. By offering customers the option to choose Splitit at your checkout, you can empower them to secure the latest trends and pay at a pace that suits them.  

Support your customer strategy 

As well as helping customers at the end of their transaction, you can integrate buy now, pay later to support your overall marketing strategy, from acquisition to retention.

Splitit offers  a white-label platform, which means you can choose to make it part of your own brand and turn it into a seamless part of your customer journey. From email marketing to onsite content, buy now, pay later messaging can support the shopping experience at every stage of the funnel. 

High fashion reseller Vestiaire uses Splitit to promote circularity and sustainable shopping in the luxury market. With Splitit at the checkout, customers are now able to access traditionally exclusive products, as they can take advantage of a flexible way to split the cost of their items into multiple payments. 

Provide a great customer experience

From Instagram’s pop-up-shops to innovation from the biggest brands, the fashion and clothing ecommerce world is one of the most cutting-edge markets out there – and having a great buy now, pay later platform can give you an edge on the competition. 

Splitit’s seamless onsite integration and easy checkout experience is vital when you’re fighting to keep customers on your site and interested in your brand. There’s no need for shoppers to navigate to another page or fill out a lengthy application. It’s easy for them to purchase the clothing they want on the payment terms that suit them. 

What to consider when choosing your buy now, pay later service provider
Buy now, pay later options are growing, and each platform works a little differently. It’s important to consider how the platform (or platforms) you choose will align with your luxury fashion or clothing business and support your sales goals.


Delivering a fantastic customer experience is key to any successful ecommerce clothing business, especially when you’re presenting high fashion and luxury items. Your BNPL platform should match this experience and meet these expectations. 

Think about how your platform works with your site’s current state and your business operations in general. Ask yourself:

  • Is it compatible with my existing platform?
  • Is the onboarding process quick and straightforward?
  • Is there support available for me and my team? 
  • Will the platform scale alongside my business?

Splitit offers simple plug-ins  for all major e-commerce platforms, with the option for custom integration. Our team will work with you at your pace, providing the level of support you need to make sure you’re up and running exactly how you want to be, both at the beginning and years down the line. 

Cost and commission

The business cost of buy now, pay later platforms varies widely, depending on the platform you choose and the package that best fits the way your clothing business operates. Typically, you can expect:

  • To pay a flat monthly or annual fee 
  • To pay commission as a percentage of each transaction (typically between 2%-8%)

Some providers like Splitit have a variety of options to suit the size and pace of your clothing business. Measured up against the increase in conversion and AOV that installment payment platforms bring to the fashion ecommerce landscape, the benefits of having BNPL at the checkout will outweigh the cost. 


It all comes back to your customers. When choosing your buy now, pay later provider, consider what your target audience is looking for:

  • Are they willing to undergo a credit check?
  • Do they prefer long or short repayment periods?
  • Will they be put off by potential fees or penalties?
  • Is affordability a primary factor of their shopping experience?
  • Are they looking for a more flexible way to use their existing payment resources?

Splitit’s interest-free, no-fee foundation has helped many businesses across the fashion and jewellery industry to drive sales and expand their strategy. 


I’ve set up a buy now pay later payment service for my customers: what’s next?

Your buy now, pay later platform should be treated like any other part of your e-commerce strategy – monitor performance, iterate your strategy, test the success, and repeat! 

With Splitit, you have the option to take advantage of our white-labelling opportunity and incorporate our buy now, pay later solution as a holistic part of your brand. This gives you countless ways to boost your customer journey at a homepage, product page, and multi-channel level. 


How can I incorporate Splitit into my clothing business?

Whether you’re looking to get an edge on your competition or support your growth strategy, Splitit can boost your customer experience and help your clothing business reach the next level. 

The best part? It’s super easy to get set up – and you can do it yourself. Our team is here to support along every step of the way. Get in touch today!