What Are Embedded Instalments?

Embedded Instalments, Defined

Embedded instalments means building payment flexibility into the places a customer already interacts with, instead of treating instalments as a separate application process bolted on after the sale has been agreed.

Rather than a customer needing to ask "can I pay this over time" and a supplier having to manually arrange something, the option is visible from the start: on the quote, in the sales conversation, on the invoice, or at checkout.

How This Differs From a Separate Finance Process

Many businesses that offer any kind of payment flexibility today do it informally and late: a customer asks for more time, and the supplier improvises an arrangement, usually once an invoice is already overdue or a sale is at risk of falling through.

Embedding the option earlier changes the timing. The customer sees payment flexibility as one of the choices available when they are deciding whether to go ahead, not as a fallback once something has gone wrong.

Where Instalment Options Can Appear

Embedded instalments can show up at several points in a typical B2B sales process, depending on how a business sells.

• Quotes and proposals: showing an instalment option alongside the total price
• Sales conversations: a sales rep mentioning instalments as part of discussing an order
• Websites and product pages: messaging that payment terms other than upfront are available
• Checkout: an instalment option presented alongside other payment methods
• Invoices: a "pay in instalments" link sent with the invoice itself
• Xero workflows: instalment offers generated directly from an existing Xero invoice

Why Timing Matters

Payment flexibility works best when a customer knows about it before they have committed to how they will pay, not after. A customer deciding between a smaller order they can afford upfront and a larger one they actually need is a very different conversation to a customer who has already fallen behind on an invoice.

Introducing instalments early gives the customer a genuine choice at the point it matters. Introducing it late, once an invoice is overdue, mostly just turns instalments into a way of managing a problem that has already happened.

Benefits for Suppliers

• Payment flexibility becomes part of the normal sales process rather than an exception
• Fewer ad hoc, informally negotiated payment arrangements to manage individually
• An instalment option can support a conversation about order size, without relying on discounting

Benefits for Buyers

• Payment flexibility is visible upfront, not something they have to request
• They can weigh the total price against the instalment schedule before deciding
• Less back and forth negotiating informal terms deal by deal

An Example Buyer Journey

Example: a commercial supplier is asked for a quote on a large order.

1. The customer requests a quote The supplier prepares the quote for the order as normal.
2. The quote shows an instalment option Alongside the total price, the quote notes that the invoice can be paid in instalments through PaidTerms.
3. The customer weighs the options They compare paying the full amount upfront against spreading the cost over a scheduled plan.
4. The customer chooses a payment method They confirm the order and select an instalment plan, or choose to pay upfront if that suits them better.
5. The supplier is paid Depending on which PaidTerms option the supplier uses, they are paid upfront in full, or as each instalment lands.
6. The customer completes the schedule The customer makes each scheduled repayment until the invoice is fully repaid.

How PaidTerms Enables Embedded Instalments

PaidTerms connects to Xero so an instalment option can be attached to an invoice as it is raised, rather than set up as a separate process. To understand the underlying mechanics first, see what business instalment payments are, and for the full New Zealand process from invoice to repayment, see how business instalment payments work in New Zealand.

Suppliers can bring instalments into quotes, invoices and the wider sales conversation without running a parallel finance process alongside their existing Xero workflow.

Frequently Asked Questions