Laybuy has become the latest entrant into the UK market for buy now, pay later services after it announced a partnership with Footasylum.

The New Zealand-based payment firm is aiming to rival the likes of Klarna, as the younger generation of consumers becomes more comfortable using phased payments to spread the cost of purchases over weeks or months.

Laybuy said the tie up with Footasylum would offer the shoe and apparel retailer to tackle the squeeze on margins from increased discounting on the High Street by allowing consumers to spread the cost of purchases over six interest-free payments, with the first made at the point of sale.

Upon completing an Experian credit check, subject to their score, Footasylum shoppers are allocated a spending limit of between £60 and £720. Purchases can then be made up to the value of that limit and should users wish to exceed that, the difference can be paid in cash.

The option to pay by Laybuy will be made available to Footasylum customers on its online store from today, with the in-store payment option being launched in Footasylum’s 70 UK stores later this year.

Gary Rohloff, co-founder and managing director at Laybuy, said: “The UK retail sector is experiencing unprecedented challenges as retailers attempt to navigate troubled waters – by providing retailers with a genuine alternative to discounts and promotions, Laybuy can not only help drive sales, but also significantly boost new customer acquisitions.”

Footasylum has been quick to embrace technological solutions in a bid to boost sales across digital and bricks and mortar channels after it issued a profit warning in January.

Last year, the company reported it had seen a 28 per cent increase in email revenue from personalised marketing communications as a result of working with artificial intelligence company Peak.

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