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Merits of Credit Card vs BNPL

Download BharatNXT app for vendor payments

Do you frequently find yourself in situations where there’s a shortfall between the funds needed for monthly expenses and what’s available in your business coffers? Are you constantly juggling payments to suppliers and vendors, often needing to settle invoices on ‘day 1’? Or perhaps you’re eager to expand your business but lack the necessary cash flow?


At the end of every month startup founders and small merchants face these financial roadblocks, and often rely on a credit line, be it BNPL or a traditional bill discounting facility. However, these facilities don’t ensure you receive the funds as and when you need them. A standard BNPL credit line will require you to register with a lender, go through arduous credit underwriting procedures, never ending KYC checks in addition to impacting your credit score every time you get rejected! Further the BNPL credit line has restricted usage to specific vendors / payables.


It’s hardly the most convenient or flexible financing solution, is it?


What if there is a solution that you already have and now has more flexibility and leverage – Credit cards. Yes! A ready solution that you already possess. Credit cards are an underrated tool for business payments which provides easy access to working capital and offer rewards like cash back or points. When you pay your vendors by choosing credit card over BPNL you also get 45-50 days of an extended credit line on your payments, this allows you to focus more on your core business operations.


Credit cards vs BNPL: Understanding key differences



  • Flexibility: Credit cards offer greater flexibility in terms of usage compared to BNPL (Buy Now, Pay Later) services. With a credit card, users can make purchases anywhere and anytime, whereas BNPL options often have restrictions on where and how they can be used.
  • Immediate Access to Funds: Credit cards provide immediate access to funds, allowing users to make purchases instantly. In contrast, BNPL services may involve registration processes and credit checks, delaying access to funds.
  • Impact on Credit Score: Utilizing a credit card responsibly can positively impact one’s credit score, as timely payments demonstrate financial responsibility. However, frequent rejections or late payments with BNPL services could negatively affect credit scores.
  • Interest Rates: Credit cards charge interest on outstanding balances if the full amount is not repaid by the due date. BNPL services may offer interest-free periods, but users need to be cautious of potential high-interest rates if payments are missed.
  • Rewards & Benefits: Credit cards often come with rewards such as cashback, points, or airline miles for every purchase made. BNPL services may not offer similar rewards, making credit cards a more attractive option for those seeking additional benefits.

In conclusion, opting for credit cards over BNPL can be a favorable choice.


You may wonder, is it even possible that your vendor/supplier will accept your card?


Well, we have a solution to that! The BharatNxt App allows you to pay your suppliers with a credit card. All you need to do is add your supplier as the beneficiary and transfer the money using your credit card to their bank account. Alternatively your suppliers, also provide you with cash discounts since they’ve been paid on day 0. 


In a nutshell, the card you own provides your business with a lifeline and saves your time. So next time, think twice before applying for a BNPL line.


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