BNPL gets more customers to buy more products from a merchant, thus that merchant makes more profit. The BNPL provider (e.g. Klarna) then takes a percentage of that extra profit as their fee. Because the provider takes on the risk of late or missed payments by a BNPL customer by paying the full price of every BNPL purchase up-front to the merchant (as if the customer had purchased the product in a single full-price transaction) there is zero additional risk to the merchant, which is why so many have adopted BNPL.