Atome partners with Syariah-compliant PayHalal to enable Islamic BNPL in Malaysia
- Syariah-compliant payment gateway PayHalal has partnered with Atome, to enable Murabaha buy now pay later (iBNPL) acceptance across the former’s merchant touchpoints in Malaysia.
- PayHalal and Atome also plan to roll out the iBNPL acceptance in Indonesia in the coming months.
Asian leading buy-now-pay-later company Atome has collaborated with the world’s first syariah-compliant (Islamic) payment gateway PayHalal to enable murabaha buy-now-pay-later (iBNPL) acceptance across the latter’s merchant touchpoints first in Malaysia. PayHalal, a Malaysia-born company, intends to also launch its services in Indonesia in the near term.
Upon offering PayHalal as a payment gateway, merchants are certified to offer products and services that are halal for consumption. PayHalal in a statement said, the Covid-19 pandemic had accelerated the shift for Malaysian shoppers to adopt digital payment options.
That said, by partnering Atome to introduce iBNPL across PayHalal’s merchant touchpoints, “shoppers now have access to a flexible, convenient and secure payment option that allows them to split their purchases into three zero-interest deferred payments, with no annual or servicing fees,” PayHalal said.
For PayHalal’s acting CEO Muhammad Sulwan Mohamed Subhan, the pandemic-driven shift towards online shopping had created an urgent need for Muslim retailers and businesses to improve and enhance e-commerce user experience.
“This partnership with Atome will broaden the payment experience across thousands of point-of-sale checkouts, with the right assortment of payment options, throughout PayHalal’s merchant network,” he said.
Atome’s CEO David Chen also shared his excitement to partner PayHalal to expand seamless Murabaha buy now pay later acceptance first in Malaysia before rolling out in Indonesia in the coming months.
syariah-compliant BNPL — Huge room for growth.
Globally, BNPL programmes have seen tremendous growth globally, for fulfilling a major consumer need and providing a financial alternative that is both simple and effective. When it comes to the Islamic market, experts reckon there lies a huge potential for the BNPL sector.
Global Islamic Financial Services Firm CEO Mufti Ismail Desai said in a blog posting that “there are significant opportunities for BNPL within an Islamic Finance context as this growing industry is estimated to be worth US$2.8 trillion, and is projected to grow to US$4.8 trillion by 2024. BNPL can be used as effective financial tool in generating tremendous financial value for Muslim consumers globally.”
To be clear, current leading BNPL service providers are mostly not syariah-compliant for two reasons: the charging of interest and the lack of an Aqd (Islamic contract) between the BNPL provider (as lender) and the consumer (as borrower). Therefore, introducing syariah-compliant offerings would actually solve many of these issues for Muslim users.
To put it simply, the focus of Islamic Finance BNPL solutions would be on providing interest-free credit, with reasonable charges and an emphasis on mutual benefit rather than any potential exploitation of customers through late payment and other fees.
The collaboration between PayHalal and Atome will not result in Malaysia’s first syariah-compliant BNPL services. In fact, earlier this year, BNPL platform Split has had its services reviewed and certified as a syariah-compliant, the first in Malaysia.