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Buy now, pay later services surged in consumer retail after the pandemic, but central bank research notes they are essentially a rebranding of long-standing layaway and installment plans. A similar approach is now appearing in residential services as rent now, pay later, or RNPL, aimed at spreading apartment rent across the month.
Industry experts say RNPL is not entirely new. Kevin King, Vice President of Credit Risk at LexisNexis Risk Solutions, noted that niche providers were offering versions of the service as early as 2019, although only recently have larger platforms begun to explore it more actively. King and others told ApartmentBuildings.com that RNPL is gaining attention in the multifamily sector, but warn that residents, owners and operators need to evaluate how it works before adopting it.
RNPL programs typically enroll renters through an app or rent payment portal. A third-party provider underwrites the renter, and once approved, the resident pays an agreed amount on the first of the month, followed by a second payment roughly two weeks later. The provider remits rent to the property owner or operator. Not all renters qualify; participants are screened for creditworthiness, and at Parktown Living, Senior Vice President Patti Higgins said residents using the Flex RNPL platform must be current on rent before they can enroll.
In exchange for splitting rent, residents may pay additional costs such as monthly membership charges, percentage-based fees tied to rent, credit card fees, or some combination. AFM Advisors managing partner Fisayo Alade described RNPL economics as a spectrum, ranging from pure convenience for the renter to operator-subsidized tools for resident retention and collections, with shared-fee arrangements in between.
Proponents highlight several advantages. For residents, RNPL can align rent with bi-weekly pay cycles and help smooth cash flow for workers with gig income, commissions or variable hours. Some platforms position RNPL as a way to build credit, though King cautioned that major credit bureaus have traditionally been selective about how they incorporate such data into core scores. Higgins added that automated payments may help residents avoid late fees and negative rental histories by reducing the chance of missed due dates.
Multifamily owners and operators may benefit from more predictable rent flow, supporting mortgage payments and property cash management. Higgins said on-time collections can improve income stability, while Alade pointed out that fewer late payments can cut down on staff time spent on notices, collections and payment-plan negotiations.
The model also carries risks. By lowering the immediate out-of-pocket burden, RNPL can tempt residents to lease units beyond their means, which King said could increase default risk and potential losses for owners, particularly where eviction processes are protracted and litigious. Alade stressed that RNPL does not change core affordability fundamentals and warned operators not to mistake steadier collection patterns for stronger resident balance sheets. Higgins observed that even modest fees can accumulate over time for renters.
The entry of BNPL provider Affirm into the RNPL space through a partnership with Esusu could help normalize the model, according to the experts. Higgins said this signals a shift from niche solution to more mainstream payment option, while Alade suggested that interest from larger players indicates underwriting and repayment behavior tied to housing is attractive enough to test at scale.
Still, King argued it is too soon to determine whether RNPL will become a widely adopted tool for multifamily housing. Default rates, user demand and owner acceptance will shape its trajectory, and slow progress since 2019 suggests broad adoption is not assured. Alade characterized RNPL as a potential way to address the structural mismatch between monthly rent schedules and bi-weekly paychecks, but said future growth will depend on integration with major payment portals, sustainable pricing of risk and how regulators respond as these programs increasingly resemble consumer credit products.
The post Rent Now, Pay Later Platforms Bring BNPL Model to Multifamily Rent Payments appeared first on CRE Market Beat.
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