Layaway is the mutual understanding between a client as well as seller. It is a way of payment in which purchaser pays payment to merchant in the form of installment, and purchased commodity is not handed over to customer until he pays all the installments. The time duration of payment is adjustable by buyer in which he has to complete all the installments. If purchaser remains unable to complete the installments then after the deduction of few charges his deposited amount is returned to him along with this the purchased product remains in the acquisition of owner.

Layaway payment plans were in fact launched during the twentieth century, when great depression shattered the economies of the world, it was due to the reason that sellers were selling commodities to those purchasers, which were deficient in purchasing power. From that era such concept was launched, if consumer is unable to buy a commodity then retailer can let consumer have that product after some amount of down payment with assurance of paying rest of the payments. In addition, a purchaser can acquire the item after completing the timely fashioned payments.

After the success of credit card shopping, majority of the retailers suspended layaway payment plans because they can have great deal of profit margins through store branded credit cards. Layaway payments regained attention of retailers at the beginning of new century, when buyers were once again reluctant about purchasing a commodity because they perceive that it can bring more customers back to them. With the inception of online commerce, some owners also offered Magento layaway payment plans.

Layaway shopping is beneficial for both consumer as well as seller, because Ecommerce hosted by Magento framework is flexible enough to handle layaway shopping through professional Magento extensions. Like everything, a Magento partial payments plan also has both positive and negative aspects, so here we are bulleting some positive attributes:

Positive Attributes Of Layaway Payments:

  • A layaway plan does not undergo interest over outstanding balance like credit cards.
  • Credit worthiness is not the requirement to avail the recurring payment program on Magento store.
  • There is no chance of facing out of stock problem of commodity after getting financial capability.
  • Debt is not incremented on the credit card, as it does not involve daily charges.
  • A layaway plan can also serve as conventional payment plan.

Negative Attributes Of Layaway Payments:

  • The partial payments program is not offered on all the items available on the shop i.e. foodstuff, computers etc.
  • Some retailers also charge additional amount apart from down payment, if these charges are not paid then it may suffer the pattern of installments.
  • A Magento recurring payments also involves replenishing charges in case alteration of commodity.
  • The payment program is likely to be aborted, in case of bankruptcy of both seller & retailer.