“Buy Now, Pay Later” Firms Continue to Gain Popularity
Recent data from Morning Consult showed that awareness and usage of “Buy Now, Pay Later” (BNPL) services have steadily increased since the start of the coronavirus pandemic. 17 percent of U.S. adults—and nearly a quarter of younger consumers—used a BNPL service for purchasing in June 2021.
For all U.S. adults, credit card ownership is four times that of BNPL usage, but only twice that of BNPL usage among Millennials and Gen Z. Also, 14 percent of Gen Xers used a BNPL service in June, and that figure could rise if BNPL services become available in more places where the generation shops.
Morning Consult researched awareness, usage, and purchasing consideration of fintechs Affirm, Afterpay, and Klarna, and found that purchasing consideration among Gen X has increased significantly—163 percent between April 2020 and July 2021.
As a group that consistently uses credit cards and is increasingly using BNPL services, Gen Xers present a good opportunity for traditional credit card companies and retailers to branch out. Institutions like JPMorgan Chase have started offering BNPL services for cardmembers to attract and retain new customers.
When Apple Pay launches its expected BNPL service, it will likely see many Gen X users try it out, along with its younger customers. Nearly a quarter of Apple Pay customers currently use a BNPL service from Affirm, Afterpay, or Klarna, with Gen Z and Millennials reporting the most usage.