Over the past 6 months or so there has been a lot of press coverage for a service called Bill Me Later. I’m sure you’ve seen it yourself on big name web sites like Walmart.com, TigerDirect.com and Overstock.com.

If you’re not familiar with it, the service does just what it says on the tin. During checkout, customers will be given the option to buy though your normal billing options like plastic or to be billed later. If they choose to be billed later, all the provide is the last 4 of their social, birth date and address. Bill Me Later will approve them in real time, the order goes through, you ship them the product and customers will get a bill in the mail 90 days later.

At first glance it’s a win-win situation for everyone. Customers who are worried about credit card theft online are put at ease and they get 90 days of credit. Merchants don’t have to worry about credit card fraud and because Bill Me Later charges a lower price than most credit cards, that means you’ll get to keep more of the money you earn right?

Well, I was quite taken with this method of payment after reading it in Entrepreneur Magazine. After all Bill Me Later seem to have all the figures to back it up. Like merchants reporting slightly bigger orders and more higher conversion rates. So, I decided to see what customers think and hit the blogs (blogs are great to find out what people really think). The results I found were mixed.

Like many services, you have those those it and those who hate it. Usually you’ll find one group bigger than the other but with this service, I found it pretty split. Most agree however, if you run into problems like returns or in one case wrong billing date (he was billed just 1 week after purchase not 90 days as promised), then the experience not only turns sour but goes downhill rapidly.

What I found disconcerting as a merchant though is how customers equate a bad experience with Bill Me Later as a bad experience with the merchant themselves. So in other words their service rubs off on you.

As a customer, I’m not sure it’s such a good thing either. Apparently, whenever you request to be billed later, Bill Me Later will quickly to a credit check. Now I don’t know if they do have any sort of agreement with the credit reporting agencies but… what if I purchase 10 items in a month? I get 10 credit checks for that month. Aren’t too many credit checks bad for your credit? Hmm.

Back to the point, is it a good choice for you as a merchant? I wish I could tell you for sure, but I suggest you take a good look at your market. Are they more concerned about security than others? Some markets are just more savvy online and some aren’t. Then, proceed accordingly. It couldn’t hurt to try.

Resources: Bill Me Later

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