Buy Now Pay Later Statistics By Usage, Demographics, Market Size, Challenges and Facts

Introduction

Buy Now Pay Later Statistics: Buy-Now-Pay-Later (BNPL) has grown quickly in recent years, especially since the pandemic started. This payment option has been around for a long time, but economic uncertainty, rising prices, and job losses have led many Americans to look for new ways to save and borrow money. While young shoppers use BNPL the most, many older adults also take advantage of it.

The worldwide transaction volume is predicted to reach $680 billion by 2025, fueled by young shoppers looking for more flexible payment choices and businesses wanting to boost their sales. This article will shed more light on Buy-Now-Pay-Later Statistics.

Editor’s Choice

• Buy-Now-Pay-Later Statistics stated that BNPL usage in the UK increased by £1 billion during the 2021 holiday season.
• 40% of BNPL users still hadn’t paid off their balances, and 11% missed payments.
• 36% of BNPL customers have made late payments or paid late fees.
• Nearly 47.45% of users aged 18-24 have missed at least one BNPL payment.
• Older users (age 54+) are the most responsible, with 62.8% saying they never miss payments.
• 56% of consumers like BNPL more than credit cards.
• Almost 38% think BNPL will eventually replace credit cards.
• 45% said ease of use is the main reason they choose BNPL.
• About 44% like the flexibility, and 35% appreciate the lower interest rates.
• 33% of consumers use BNPL because their credit cards are maxed out.
• 84% of Luxury Shoppers Want BNPL Options
• 84% of luxury shoppers prefer BNPL for expensive purchases.
• 57% of consumers actively look for BNPL options at checkout.
• Buy-Now-Pay-Later Statistics stated that almost 65% of BNPL users return for at least one more purchase.
• On average, customers make two BNPL purchases within six months.
• Millennials, who own two fewer credit cards than Gen X, are the biggest users of BNPL.
• 87% of shoppers aged 22-44 prefer paying in instalments for larger purchases.
• Almost 20.3% of young consumers have low credit scores, making it harder to get traditional credit cards.

What is Buy-Now-Pay-Later?

Buy Now, Pay Later (BNPL) is a short-term loan that lets shoppers break up payments into smaller, easier amounts over time. People often use BNPL for expensive items like smartphones or designer clothes. Unlike regular loans, BNPL is usually interest-free and has little to no extra fees, making it a good choice for those on a tight budget. However, it can also lead to overspending, as some people may buy more than they can actually afford.

BNPL terms depend on the provider, but most offer fixed payments over a few weeks or months. If a store accepts BNPL, you can choose it at checkout or use it through your credit card if your card company provides this option. BNPL works like instalment loans, such as personal loans, car loans, or mortgages. The seller gets the full payment upfront from the BNPL provider, and the customer pays the amount back in smaller instalments.

General Buy- Now-Pay-Later Statistics

• The average amount people spend using Buy Now, Pay Later (BNPL) is $104.30.
• Buy-Now-Pay-Later Statistics stated that about 39.3% of BNPL users choose it to avoid paying interest on credit cards.
• Around 45% of surveyed shoppers said they use BNPL to buy things they otherwise couldn’t afford.
• BNPL is growing as more people look for interest-free and flexible payment options.
• Experts predict that by 2030, the BNPL industry will be worth around $3.98 trillion. This growth is mainly driven by younger consumers and the fact that many people have lower credit card limits.
• The BNPL market is expected to grow at a rate of 45.7% per year, reaching $3.98 trillion by 2030, a huge jump from $90.69 billion in 2020.
• The Point of Sale (POS) BNPL option is expected to grow the most, expanding by 49% annually until 2030.
• Buy-Now-Pay-Later Statistics stated that almost Near53% of people who haven’t used BNPL before are planning to try it within the next year.
• Millennials also doubled their BNPL usage during the same period.
• Buy-Now-Pay-Later Statistics stated that BNPL helps increase sales by 20% to 30% at checkout.
• Shoppers using BNPL often spend 30% to 50% more than those who pay in full right away.

(Source: thebusinessresearchcompany.com)

• Buy-Now-Pay-Later Statistics stated that almost 41% of users say they use BNPL to save money for emergencies.
• 25% started using BNPL due to income loss caused by the pandemic.
• Nearly 45% admitted using BNPL to buy things they couldn’t afford otherwise.
• 62% of BNPL users believe it can replace credit cards, especially for younger consumers who struggle to get approved for traditional credit.
• A CR Research survey found that 51% of consumers used BNPL during the pandemic due to financial struggles.
• Buy-Now-Pay-Later Statistics stated that almost 71% of shoppers increased their online spending during this time.
• The Washington Post reported that the average BNPL transaction is $104.
• Interestingly, people earning over $200,000 per year were less likely to use BNPL services, with only 9% having used them.
• BNPL was also more common among renters, with 22% of renters using these services, compared to 15% of homeowners.
• Additionally, women were slightly more likely to use BNPL than men—22.7% of women reported using these services, while only 14.3% of men did.

Buy-Now-Pay-Later Usage Statistics

• A recent study revealed that 29% of people who use BNPL make purchases with it at least once a month.
• Moreover, 80% of BNPL users rely on the service at least once every six months.

• A survey conducted in September 2020 revealed that 41.8% of participants preferred Buy Now, Pay Later (BNPL) because of its transparent fees and interest rates.
• Other common reasons people chose BNPL included:

1. “Easier to track spending” (39.1%)
2. “Convenient payment option” (37.2%)
3. “Accepted by many retailers” (36.7%)

• Out of the seven reasons listed, the least popular was “rewards programs,” with only 24.3% of users considering it important.
• Here’s how BNPL compares to credit cards and digital wallets in terms of user preferences.

• Buy-Now-Pay-Later Statistics stated that the average BNPL user is currently making payments on about four items, with the typical number being 3.8 items.
• Most users pay between $101 and $205 per month in instalments. However, the average cost of the last item purchased was $689, while the total amount still owed averaged $883.
• Clothing is the most common item bought using BNPL, with 63.5% of users purchasing apparel.
• Entertainment is the second most popular category, with 30.3% of BNPL users spending in this area, followed by books and other reading materials at 29.4%.

(Reference: explodingtopics.com)

• 12% of shoppers say they always use BNPL.
• Buy-Now-Pay-Later Statistics stated that almost 67% of consumers use BNPL for at least half of their online purchases.
• 35% of people choose BNPL most of the time when shopping on the internet.
• Here’s a closer look at the survey results:

Buy-Now-Pay-Later Demographics Statistics

• Buy-Now-Pay-Later Statistics show that Black women between 25 and 44 are the most common users of Buy Now, Pay Later (BNPL) services.
• Around 42% of adults between 18 and 24 in the U.S. use BNPL for their purchases. Gen Z is more aware of different payment methods and chooses options that fit their budget and savings plans.

(Source: demandsage.com)

• However, the highest BNPL usage is among people aged 25 to 44. This group, mainly Millennials, deals with more financial responsibilities and stress, making BNPL a convenient way to manage expenses.
• The table below shows how different age groups have used Buy Now, Pay Later (BNPL) services from 2020 to 2023. It highlights the increasing popularity of this payment method among various age groups over the years.

• Buy Now, Pay Later (BNPL) services are more commonly used by women than men. Over the past 12 months, 29% of women have used BNPL, and 11% said they used it more than five times for online shopping.

(Reference: scoop.market.us)

• In comparison, 26% of men used BNPL during the same period, but only 9% used it more than five times.
• When it comes to what they buy, 58% of women use BNPL for clothing and fashion items, while 58% of men prefer using it for electronics and media products.
• The table below provides a breakdown of BNPL usage among online shoppers in the past 12 months.

• Compared to other racial groups, Black and Hispanic shoppers are more likely to use Buy Now, Pay Later services.
• Many BNPL users belong to lower-income groups, have lower credit scores, or struggle to access traditional credit options.

(Reference: scoop.market.us)

• The table below shows more details on BNPL usage among different ethnic backgrounds.

Buy-Now-Pay-Later Apps Statistics

• Buy-Now-Pay-Later Statistics stated that there are about 12 Buy Now, Pay Later (BNPL) providers in the U.S. The table below lists the most popular BNPL services among consumers.

Here’s a simple breakdown of some of the most widely used Buy Now, Pay Later (BNPL) services in the U.S.:

• PayPal Credit – This BNPL service allows users to divide their purchases into four equal payments with no interest. It includes automatic payments, purchase protection, and no fees for sign-up or late payments. Payments are due every two weeks, and shoppers can finance amounts ranging from $30 to $1,500. However, it is not available in all states.
• Afterpay—Customers can use Afterpay both online and in stores at participating retailers. It lets users split their total into four interest-free payments over six weeks. However, late fees can reach 25% of the purchase amount. The service also provides discounts and rewards through its app.
• Affirm – This BNPL option does not charge annual fees or late payment penalties. It offers a four-instalment plan with no set spending limit, as the approved amount depends on the customer’s credit. Affirm is accepted both online and in physical stores at numerous retailers across the U.S.
• Klarna – Like other BNPL platforms, Klarna lets users split their purchases into four interest-free payments. The spending limit is based on creditworthiness. Klarna is available for online and in-store shopping at various retailers. The Klarna app also has a price comparison tool to help users save money and earn rewards for every dollar spent.
• Zip (Zip Pay) – A global BNPL provider available at 94,000+ merchants worldwide. Zip allows shoppers to divide their payments into four instalments over six weeks. Unlike other services, Zip charges a $6 instalment fee and a $5 late fee. However, users can still access discounts and rewards at select retailers.

Buy-Now-Pay-Later Market Size Statistics

• The Buy Now, Pay Later (BNPL) industry was valued at $71.93 billion in 2023 and is expected to grow to $80.77 billion by 2024.
• Moreover, 5% of all online shopping transactions were completed using BNPL services in 2022. This number is projected to rise to 7% by 2026.

(Reference: demandsage.com)

• The Buy-Now-Pay-Later (BNPL) market in the U.S. was valued at $1.64 billion. Experts predict it will grow at a 24.3% annual rate between 2023 and 2030.
• One of the main reasons for this growth is the ease and flexibility BNPL offers shoppers. Additionally, consumer habits are evolving, leading to a greater demand for these payment options.
• Younger generations, especially Millennials and Gen Z, prefer BNPL services because they match their spending patterns and financial preferences better than traditional credit options.

What items do most consumers use BNPL to buy?

• In the U.S., clothing is the most commonly bought item using Buy Now, Pay Later (BNPL) services. Electronics rank second, followed by shoes, home decorations, and accessories.

(Reference: finmasters.com)

• In the UK, people use Buy Now, Pay Later (BNPL) services for similar purchases as those in the U.S. The most common items bought with BNPL are electronics, such as TVs and smartphones.
• Other frequently purchased products include clothing, shoes, and accessories from both mid-range and luxury brands, as well as home improvement appliances.

(Reference: finmasters.com)

• Buy-Now-Pay-Later Statistics stated that 57% of BNPL users in the U.S. regretted using this payment method at checkout. The main reason was spending more money than they could afford.
• Similarly, research from LendingTree showed that 31% of BNPL users with an annual income of $100,000 or more also regretted some of their BNPL purchases.

Challenges Faced by Buy-Now-Pay-Later Statistics

• Even though Buy Now, Pay Later (BNPL) is popular, 66% of users worry about its financial risks.
• One big issue is that BNPL purchases don’t always show up on credit reports, making it harder for people to keep track of their total debt. This can lead to overspending and financial problems, showing the need for better awareness of responsible borrowing.
• Buy-Now-Pay-Later Statistics stated that 34% of Americans using BNPL have missed at least one payment, which can lead to late fees and damage to their credit scores.
• Since BNPL allows delayed payments, many shoppers—especially younger ones—spend more than they can afford, increasing their risk of falling into debt.
• The BNPL industry is crowded, with over 200 companies offering BNPL services worldwide.
• Big companies like Apple and JPMorgan Chase have entered the market, using their strong financial resources and customer networks. This makes it harder for smaller BNPL companies to survive, and according to Moody’s, many may be forced to merge, sell, or shut down due to competition.
• Retailers accepting BNPL payments may soon face merchant fees between 2% and 8% per sale.
• If these fees keep increasing, fewer businesses may want to offer BNPL, which could slow down the industry’s growth and make it tougher for BNPL companies to stay in business.

(Reference: superteamhq.com)

• Buy Now, Pay Later (BNPL) providers earn money by charging businesses a fee on each transaction. These fees usually fall between 2% and 8% per purchase.
• Research from the National Bureau of Economic Research (NBER) found that using BNPL can cause people to spend about $60 more per week than they normally would.
• This increase in spending can stretch household budgets by 30%, which may lead to financial difficulties if payments aren’t managed properly.

Buy-Now-Pay-Later Future Trends

• Right now, the most common items people buy using Buy Now, Pay Later (BNPL) are clothing, followed by home decor (like furniture and appliances) and electronics.
• The use of BNPL for these purchases is expected to keep growing, and the total global BNPL transaction value is likely to surpass $500 billion in the near future.
• In 2023, the total amount of BNPL transactions in e-commerce was $309.2 billion, and it’s projected to rise to $386 billion in 2024—an increase of $77 billion from the previous year.
• Additionally, from 2022 to 2023, BNPL transaction volume grew by nearly $96 billion.
• The table below outlines BNPL’s global transaction volume growth over the years.

• Around 46% of shoppers choose Buy Now, Pay Later (BNPL) to buy clothing, shoes, and jewellery.
• This payment option helps people afford luxury brands, designer bags, and other expensive fashion accessories without paying the full amount upfront. Because of this, women are more likely to use BNPL to shop for fashion.
• 33% of consumers use BNPL for home decor, furniture, and appliances.
• Buy-Now-Pay-Later Statistics stated that 30% prefer BNPL for tech gadgets like smartphones and laptops.
• Only 10% of users rely on BNPL for travel expenses.
• Buy Now, Pay Later (BNPL) has become a popular way to shop online. It allows customers to make purchases and pay over time with low interest rates.
• Because of its convenience, more than 360 million people already use BNPL, and this number is expected to exceed 900 million in the next four years as more shoppers choose this flexible payment option.

Conclusion

The Buy Now, Pay Later (BNPL) market is expanding quickly as more shoppers look for flexible ways to pay. With millions of people using BNPL services and total transaction value expected to go beyond $500 billion in the near future, this payment method is changing online shopping habits. However, while BNPL makes purchases more affordable, there are concerns about overspending and rising debt. As the industry grows, both consumers and providers must focus on responsible spending and financial education to keep BNPL a sustainable option. We have shed enough light on Buy-Now-Pay-Later Statistics through this article.