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PayPal said this week that it is enabling a short-term installment payment offering for merchants in the U.S., one announcement among a flurry of activity around buy now pay later options.

The new PayPal product, which the company called “Pay in 4,” allows merchants to receive their money upfront while consumers can choose to pay for purchases in four interest-free installments over a six-week period – with no fee as long as the payments are made on time.

The offering is geared to help merchants drive conversion and increase sales, the company said. It cited its own internal data that suggests merchants who include what it calls “pay over time” messaging on their web sites increased their PayPal average order values by 56%.

“In today’s challenging retail and economic environment, merchants are looking for trusted ways to help drive average order values and conversion, without taking on additional costs. At the same time, consumers are looking for more flexible and responsible ways to pay, especially online,” said Doug Bland, SVP, Global Credit at PayPal.

“With Pay in 4, we’re building on our history as the originator in the buy now, pay later space, coupled with PayPal’s trust and ubiquity, to enable a responsible and flexible way for consumers to shop while providing merchants with a tool that helps drive sales, loyalty and customer choice.”

The PayPal offering is just the latest merchant-centric option for installment financing. Short-term purchase financing has been gaining popularity rapidly in recent months, as a way for retailers to encourage spending during the current economic downturn.

Also this week, installment payment provider QuadPay announced an integration with the Mastercard Vyze alternative financing platform to offer Mastercard merchants the buy now pay later option. In its press release, QuadPay claimed that merchants using its service typically see an increase in average order value of 20% to 60% with up to a 20% increase in their conversion rate.

QuadPay is also enabling installment payments for Stripe.

Then on Wednesday, Mastercard announced a separate partnership with payments processor TSYS to offer installment payments before, during and after a sale, a card-based service that complements its own merchant offerings in the space.

“Adding the installment lending function to a bank card is suitable for all parties in the transaction. The consumer has a discrete transaction, separate from their general purchasing. Merchants get to close the sale, and similar to credit card usage, have an opportunity to upsell the customer. The issuing bank benefits with increased spending,” Brian Riley, director of the credit practice at Mercator Advisory Group, said.

Earlier this year, Mastercard partnered with payment facilitator Pine Labs to grow its installment financing options in South Asia. According to that announcement, the market for installment payments in India is expected to be $16.9 billion in 2021, rising to $52.5 billion by 2025.