Last updated on October 18th, 2021
First National Bank of Omaha (FNBO) is the latest credit card issuer to offer customers a Buy Now, Pay Later solution. The bank, one of the top 25 credit card issuers in the US, launched its “Slice by FNBO” in an attempt to halt an erosion of customers turning to offerings from fintechs like Affirm for installment payments over traditional credit cards.
First Bankcard Launches Slice by FNBO
First National Bank of Omaha is one of the largest credit card issuers in the United States. While the name First National Bank of Omaha might not sound familiar, the bank’s other names might: FNBO and First Bankcard. First Bankcard is one of the largest issuers of co-branded credit cards on the market, with partnerships including Icelandair, Ford, Jeep, Best Western, MGM, and more.
FNBO is now joining the ranks of major card issuers that will offer Buy Now, Pay Later (BNPL) services. The bank has launched “Slice by FNBO,” a BNPL program allowing consumers to pay in “slices” instead of all at once.
The new Slice by FNBO is a “pay in five” program, with eligible customers making one payment up-front, followed by four payments every 15 days. The program was launched with the assistance of EXL, a data analytics company, and Skeps, a point-of-sale loan origination platform.
BNPL Attracting Younger Demographics
FNBO’s move into BNPL is yet another sign that the popular financing option is here to stay. First National Bank of Omaha is considered one of the more conservative card issuers regarding fintech trends, so any moves by banks like FNBO only highlight the growing importance of BNPL.
Indeed, Jerry O’Flanagan, Executive Vice President of FNBO’s Partner Customer Segment, says the move was a pragmatic step to try and mitigate against customer erosion in the face of competition from fintech firms like Affirm, Splitit, and others. “There’s a component of Buy Now, Pay Later that attracts a younger demographic, he said in an interview regarding the launch of Slice by FNBO, “so this new program is good for us, to be honest. We have a rather old portfolio — our average age is in the 50s.“
“Our payment apparatus, especially where it involves retailers, is so predicated on rewards and credit cards,” added O’Flanagan, “and I just couldn’t see it taking hold.” However, his attitude changed with the rise of Affirm, Klarna, and other BNPL offerings from major banks like Amex (Plan It), Chase (My Chase Plan), and Capital One. “Our customers were getting sales calls from the BNPL outfits, and they were asking us, ‘Do you have a BNPL solution?’”
Related Article: Marqeta 2021 State of Credit Report Shows Rise of BNPL