Consumers have adopted BNPL quickly, seeing it as a less expensive alternative to credit cards. At the same time, there are serious concerns over consumers taking on more debt than they can pay.

Let’s look at BNPL by the numbers.

Key Findings

  • BNPL market size was approximately $120 billion in 2021.
  • BNPL accounted for 1% of global PoS payments in 2021.
  • Sweden and Germany lead the way in BNPL usage.
  • In 2022, BNPL services were used by 360 million people worldwide.
  • Gen Zers and Millenials are more likely to use BNPL often than their older counterparts.
  • In the US, clothing is the item most likely to be purchased using BNPL.
  • BNPL borrowers owe $883 on average.
  • 57% of US BNPL users regretted using the method to check out.

BNPL Market Size & Biggest Players

How Big is the BNPL Market?

According to Payments Cards & Mobile, the global BNPL market size was approximately $120 billion in 2021. The figure represents 100% growth from 2020, when the market size was $60 billion and $34 in 2019[1].

As an element of e-commerce, BNPL’s market share has grown significantly over the past few years, as suggested by SEON data[2]. According to the data, BNPL services.

How has BNPL’s share of e-commerce payments increased?

BNPL Market Share of E-commerce Payments 

Globally, BNPL’s share of e-commerce payments has increased substantially since 2016. In 2016, BNPL accounted for only 0.4% of the e-commerce payments avenues. The share increased to 1.6% in 2019, 2.1% in 2020, and 3.0% in 2021.

BNPLL is also gaining popularity as a point-of-sale (PoS) payment method. According to Worldpay, BNPL accounted for 1% of global PoS payments in 2021[3].

According to Worldpay, Payments Cards & Mobile, and, Sweden tops the world as the fastest adopter of BNPL services[3] [4] [2]. In 2021, 25% of e-commerce payments in the country were made using BNPL services, up two percentage points from 2020 and unchanged from 2019. Sweden has topped the table of countries where BNPL is used the most since records have been kept.

Germany is the closest competitor. BNPL as a percentage of e-commerce payments in Germany was 18% in 2019, 19% in 2020, and 20% in 2021. Norway comes a distant third at 13%, 15%, and 18% for 2019, 2020, and 2021, respectively. 

Interestingly, no country from the Americas, the Middle East, or Africa appears in the top ten countries where BNPL is most popular. The United States is eleventh, tied with France, Singapore, Malaysia, and Italy. BNPL claimed 4% of e-commerce payments in each one of those countries in 2021. 

Countries where BNPL is used the most

According to The Straw Group (TSG) and Electronic Transactions Association (ETA) survey respondents said they used Afterpay and PayPal Credit[5]. Klarna, Affirm, PayPal Pay-in-4, Sezzle, and Zip followed, with 12%, 10%, 9%, 3%, and 3% saying they used the platforms, respectively.

Most popular BNPL options in the US in 2022, according to the TSG-ETA survey

Who Uses Buy Now Pay Later?

How Many People Use BNPL Services?

According to Juniper Research, there were approximately 360 million BNPL service users worldwide in 2022[6].

The number of people using BNPL services keeps rising in the United States. A LendingTree survey established that 31% of Americans utilized BNPL services in 2021, rising to 43% in 2022[7].

In the United Kingdom, more than 17 million people had used BNPL services by November 2021[8]. A survey conducted at that time found that one in 10 people in the UK were planning to use BNPL to help with Christmas shopping (for December 2021)[9]. In October 2021, 28% of the UK’s adult population made BNPL repayments, Equifax data shows[10]. Further, a Forbes Advisor survey established that an average British shopper uses BNPL schemes 3.6 times monthly[11]

In Australia, the 2020-2021 financial year saw a record number of Australians using BNPL services. Research by RFI Global on behalf of the Australian Finance Industry Association shows 38% of the respondents used BNPL services[12]. During the 2020-21 financial year, BNPL platforms in Australia reported 5.9 million active accounts, which spent AUD 12 billion.

BNPL Users by Age

Research by LendingTree shows that as of January 2023, Gen Zers (consumers aged between 18 and 25 years) use BNPL the most in the US. Approximately 58% of America’s youngest generation have used BNPL services. Millennials (Generation Y) come in second at 54%, 44% for Generation X, and Baby boomers use the services the least, at 22%[7].

US BNPL usage by age group as of January 2023

In 2021, more millennials used BNPL services in the US than any other age group. A CFPB analysis revealed that millennials accounted for 51.8% share of unique BNPL borrowers in 2021[13]. They were followed closely by Gen Xers with a 29.2% share, 16.8% for Gen Z, and 2.1% for Boomers. Interestingly, the CFPB’s analysis indicates that millennials took out a higher percentage of BNPL loans in 2021 than the age cohort’s share of the country’s population. In contrast, the Boomer age group is the most under-represented cohort in the BNPL market (with an index ratio of 0.1).

Share of unique BNPL borrowers by generation in 2021 vs. overall 18+ US resident population (2020 Census Bureau data)

Generation Share of unique BNPL borrowers18+ US resident population (2020 Census) Index Ratio
Generation Z16.8%11.7%1.44
Generation X29.2%38.3%0.76
Baby boomers2.1%22.0%0.10

More people in the United Kingdom are drawn to BNPL services. According to a Forbes Advisor survey, UK’s Gen Z uses BNPL services most frequently. This number is also significantly higher than the US figure. In addition, the study established that one in five consumers in the 18 to 24 age bracket have relied on BNPL to checkout during shopping. The second most frequent users are consumers in the 25 to 34 age range[11]

BNPL services usage in the UK by age group as of November 2022

BNPL Users by Gender

According to LendingTree, women (45%) are more likely to use BNPL services than men (42%)[7].

BNPL Users by Household Income

According to the Federal Reserve Bank of Philadelphia, the heaviest users of BNPL services in the US come from households with an average income above $75,000. Consumers from households with an average income of less than $40,000 use BNPL services lightly[14].

BNPL usage in the US by household income

Why and How People Use BNPL

Why Do Consumers Choose to Use BNPL?

According to a Federal Reserve Bank of Philadelphia survey, most Americans use BNPL because it is convenient[14]. Others opt for the payment method when the purchase size is appropriate.

Reasons for using BNPL

What Items Do Most Consumers Use BNPL to Buy?

Clothing is the item most likely to be purchased using BNPL in the US. The second most purchased item is electronics, followed by shoes, home décor, and accessories[7].

What US consumers buy with BNPL loans

UK consumers use BNPL loans for almost identical categories of items. Electronics, such as mobile phones and TVs, are the most common purchases for BNPL borrowers. Other popular categories of items include clothes, shoes, and accessories at mid-range retailers, clothes and shoes at luxury retailers, and home improvement appliances[11].

Items UK consumers bought with BNPL loans

Do Consumers Regret Using BNPL?

According to C+R Research, 57% of US BNPL users regretted using the method to check out when making purchases, often because they spent more than they could afford to pay[15].

LendingTree found that 31% of BNPL users earning $100,000 or more per year regretted some BNPL purchases[7].

What Is the Average BNPL Debt Owed by Consumers?

According to C+R Research, US BNPL borrowers owe $883 on average[15].

Average amount of BNPL loans owed by US consumers

In the UK, consumers using BNPL take on an average of £160 ($196) BNPL loan per month. Generation Z is the most indebted, holding an average of £207.84 ($254.80) BNPL loan monthly[11].

Average monthly BNPL borrowing by UK consumers

How Many Consumers Fall Behind on Payments?

Most US BNPL borrowers who have fallen behind on payments are Gen Zers. According to CFPB, the share of unique BNPL borrowers with one or more default charges who are in the 18-24 years age cohort was 5.3% in 2019, 5.2% in 2020, and 5.7% in 2021. In addition, many borrowers in the 25–33-year age cohort also fell behind on payments. The consumers who are less likely to fall behind on payments are aged between 51 and 64 years[13].

Share of unique US BNPL consumers by age group with one or more default charges

The same trend can be seen in the United Kingdom, where two in five BNPL users aged 18 to 24 miss monthly payments[11]

Share of UK BNPL borrowers missing payments by age group

Total 18 – 2425 – 3435 – 4445 – 5455 – 6465+
Every few months27%26%37%28%14%45%8%
Every six months11%16%4%13%7%9%23%

Let’s Sum That Up

BNPL loans are gaining in popularity for good reasons. They’re convenient, and approval is typically easy. There’s no interest, which makes them much more affordable than credit cards.

They are also risky. Lending Tree’s survey found that 68% of respondents said they typically buy more when using BNPL than they do when they pay in cash. That tendency can make it very easy to take on more debt than you can pay[7].

Like most other forms of credit, BNPL can be a useful tool when used responsibly and a serious risk if it isn’t!

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