“Food ordering a prominent spending category for our users”: Aravind Tambad, Uni Cards

First, it came for our homes. Then, it turned its attention towards our cars and motorcycles. It was not enough, so, it targeted our washing machines, air conditioners, followed by desktops and laptops. Around a decade ago, it took aim at our smartphones.

Today, it’s making its way towards our clothes, dining and food delivery. ‘Buy now, pay later’ (BNPL) has enjoyed many forms over the last few decades. But its latest avatar has changed the way people consume, perhaps, forever.

As per a 2021 RedSeer Management Consulting report, India’s BNPL market will be worth $45-50 billion by 2026, from $3-3.5 billion now. Also, the number of (its) users will rise to 80-100 million, from 10-15 million at present.

Home loans, personal loans and automobile loans remain the most popular versions of BNPL for big-ticket goods. Its latest iteration, from brands like Uni Cards, Slice, PostPe, Zest Money, Amazon Pay Later, etc., is making people buy more of every day stuff, like clothes, phones, personal and beauty care items. And, in the process, BNPL is taking on, and increasingly replacing, credit cards as the mode of payment.

A clampdown on hidden charges, affordable interest rates, quicker disbursal of cards, little to zero joining and annual charges, etc., are some of the benefits these brands offer over cards.

Adding a new dimension to the BNPL ecosystem is Uni Cards’ ‘Pay 1/3rd card’, where your payment is split into three equal parts (to be paid) over three months. If you want to pay the entire sum in the first month itself, then you will get a one per cent cashback.

There is a minimum amount due every month and if you pay less than the due amount, a carry forward fee, which changes as per the customer's repayment behaviour and pending amount, is levied.

Aravind Tambad, vice president, growth & marketing, Uni Cards, tells afaqs! that they want “flexibility for the consumers” and the choice to split the repayment into longer tenures is in the pipeline.

The brand’s love for flexibility is evident in its first campaign, with the tagline #UniSoFlexi, featuring actor Vicky Kaushal. Both the brand and Leo Burnett, the agency behind the campaign, literally cut Kaushal into three parts to drive home their message of the Pay 1/3rd card.

Kaushal is young and relatable to the millennials. But he is raking in crores every year, so, wouldn’t an influencer be a better fit for a BNPL brand? “We wanted to go with someone mainstream because we wanted to appeal to a larger audience… We have already worked with influencers across lifestyle, entertainment and finance,” says Tambad.

The Pay 1/3rd card is available to anybody between the ages of 21 and 60 years, but the target group is “25-44-year-old savvy millennials.” Tambad adds that despite having a presence in 130 cities across India, “almost two-thirds of our customers come from the top six cities.”

Over the last two decades, consumer habits have moved - from frugality to debt. Still, it’s hard to convert users to debt sometimes. When asked about the pain points of acquiring users, Tambad reveals they’ve come across very few friction points and that “the demand for a product like this is much higher.”

Where is this card being used? Says Tambad, “Food ordering is a prominent category of spending for our consumers. We're seeing strong and equal spending, both offline and online.”

The higher the demand for a service, the more the service providers. Uni Cards has to deal with credit card providers as well as rivals within the new BNPL ecosystem. Differentiation is the key to winning the race here.

Uni Cards' main differentiator is the Pay 1/3rd card. And also, the users' ability to pay the entire sum at one go and enjoy a one per cent cashback.

Tambad mentions that to tackle defaults, the brand sends regular reminders and has a 24x7 WhatsApp chat support in place. Uni Cards also puts a lot of effort into risk assessment, as far as its users go. As of now, “we're offering it (Pay 1/3rd card) to financially savvy users, with good credit,” Tambad concludes.