• Installments Enabled by Visa: Consumers can buy now and pay later

    Introducing installment payment APIs

Visa is developing installment solutions

In the near future, Visa will be releasing capabilities on Visa Developer to allow clients to develop and pilot installment experiences to offer to their customers.*

*Availability is subject to factors outside of Visa’s control, including participation by issuers, acquirers and merchants. 

Introduction to installment payments

Installment payments (installments) refer to the option to pay for purchases over time by dividing the purchase amount into smaller equal payments. Consumers will typically use installments to buy media and large ticket items (e.g. electronics, furniture). But in some markets, they may even use them to make everyday purchases (e.g. groceries, retail). So, what’s the key benefit for consumers with installments? They get to spread their purchases, including transparent fees, into periodic (usually monthly) repayment amounts.

The following example shows how installments payments work for a large ticket purchase of $800 paid for over 4 months, 0% APR:

Donut chart showing 1 out of 4 payments.

Paid $200

1st installment

Donut chart showing 2 out of 4 payments.

Paid $200

2nd installment

Donut chart showing 3 out of 4 payments.

Paid $200

3rd installment

Donut chart showing 4 out of 4 payments.

Paid $200

4th installment

Common installment payments models

There are three primary models in the global installment payments landscape: Pre-Purchase, During Purchase and Post-Purchase. These models differ based on when the consumer is offered installments, who presents the installment payments plan, and who pays for the cost of providing credit.*

*Financial institutions are solely responsible for their own installment program.

Pre-purchase

Consumer opts-in for installments pre-purchase

During purchase

Consumer prompted at merchant checkout to pay with installments

Post-purchase

Consumer converts a recent card transaction into installments

Illustration of a paper and a pencil.

Create plan

API for issuers to create installment plans. Issuers to define plan attributes such as:  

  • Duration of installment plan
  • Participating merchants and cards
  • Interest (and fees if applicable)

Check eligibility

API for acquirers, technology platforms and merchants to look up eligible installment plan(s) for an installment transaction. Merchants can display eligible installment plans to an eligible cardholder during purchases.

Example: 6 month installment plan for all eligible Visa cardholders from Bank A at home appliance stores

Select plan

API for merchants to confirm the cardholder selected installment plan for a given transaction.

Visa card circled with reverse arrows.

Convert plan

API for issuers to convert the original transaction into an installment plan.

Illustration of calendar with check mark.

Schedule plan

API for issuers to schedule payments of installment transactions. The service will look up cardholder status and calculate monthly installment payments due, so that issuers can manage general ledger and post to cardholder statement correctly.

Installments Enabled by Visa can provide benefits for all parties in the ecosystem

Consumer

Increase payment options on existing cards in wallet
Illustration of a store front and a person.

Merchant

Help increase sales volume and conversion rates
Illustration of a issuer bank building front.

Financial institution

Help increase cardholder engagement and loyalty with new revenue stream
Illustration of a blue and yellow hands shaking each other.

Acquirer

Help protect against volume erosion; new value added service for merchant offering

Note: Depicts conceptual vision in development; features, functionality, availability are subject to change. Issuer is solely responsible for its own installment program.