Buy now pay later removes one of the most common barriers to high-ticket purchases: the requirement to pay the full amount upfront. For products above £50-£100, offering installments typically increases conversion rate by 20-30% on the items it's most relevant for - particularly in furniture, fashion, electronics, and beauty.
The main BNPL options for Shopify UK
Klarna. The most recognised BNPL brand in the UK and Europe. Offers three products: Pay in 3 (interest-free, spread over 3 months), Pay Later (pay within 30 days), and Financing (longer-term monthly installments). Available on Shopify via Shopify Payments if your account is eligible, or as a direct Klarna integration.
Klarna's logo recognition drives conversion: customers are more comfortable entering a purchase into a known brand they've used before. The downside: Klarna charges merchants a per-transaction fee (typically 0.30 + variable percentage) on top of standard card processing fees.
Clearpay (Afterpay). Pay in 4 installments over 6 weeks, interest-free. Popular with younger demographics and fashion-forward brands. Slightly lower brand recognition than Klarna in the UK but strong in the fashion and beauty categories. Available as a direct integration with Shopify.
Shop Pay Instalments. Shopify's native BNPL, powered by Affirm in the US and through Shopify Payments infrastructure in other markets. Available to merchants using Shopify Payments. Seamlessly integrated into the Shopify checkout - no separate app installation, no additional merchant fees beyond standard Shopify Payments rates. Currently available in the US; check availability for your country in Shopify Payments settings.
Laybuy. Pay weekly over 6 weeks, interest-free. Strong in Australia and New Zealand, growing UK presence. Good for mid-ticket items in the £40-£300 range.
Which BNPL option to choose
The decision depends on your price point and market:
Under £50 average order value: BNPL is unlikely to move conversion rate meaningfully at this price point - the installment amounts are small enough that upfront payment isn't a significant barrier. Focus on other conversion improvements.
£50-£300: Pay in 3 (Klarna) or Pay in 4 (Clearpay) are the right fit. Short-term, interest-free installments reduce the psychological barrier to purchase without requiring a formal credit application from the customer.
£300+: Longer-term financing (Klarna Financing, 6-24 month options) becomes relevant. Monthly payments of £30-£50 for a £600 purchase feel more manageable than 3 x £200.
For most UK Shopify merchants, Klarna Pay in 3 is the default choice given its brand recognition. Add Clearpay if your audience skews under 30 (Clearpay has stronger penetration in that demographic).
Displaying BNPL on your product pages
BNPL only drives conversion if customers see it before the checkout. The right placement: a "or 3 interest-free payments of £X with Klarna" message directly below the price on your product page, near the add-to-cart button.
All major BNPL providers have Shopify widgets that add this messaging automatically once installed. Enable them and check the placement looks correct on mobile - the installment message is often more impactful on mobile where the total price feels larger.
The merchant cost trade-off
BNPL providers charge merchants a fee (typically 2-6% + a fixed amount per transaction) for taking on the credit risk. This is higher than standard card processing fees. The trade-off: if BNPL increases average order value and conversion rate enough to offset the additional fee, it's net positive.
Run a 30-day comparison: look at average order value and conversion rate for orders that used BNPL vs standard payment. If AOV is significantly higher for BNPL orders (it usually is, since BNPL removes price sensitivity), the higher merchant fee is justified.
