Get ahead in the UK buy now, pay later (BNPL) market with this comprehensive report. Know how and why consumers use BNPL, how the market is performing, and key player strategies to inform an effective strategy for your business.
During uncertain economic times, cost-effective credit options form an important part of consumers’ finances. The last two years of rising prices have affected the ability to spend and save, which has led to a growing use of BNPL. The product’s instalment structure can help people better manage their cashflow.
Despite strong consumer intention to use the product over the next year, only 30% of UK adults believe BNPL is easy to understand. This implies a wide knowledge gap and a need to improve education around the product’s benefits and potential risks.
With the government confirming that BNPL will be FCA-regulated within the next two years, brands have an opportunity to pre-empt the introduction of regulation by ensuring robust affordability checks are already embedded in checkout processes. This will help improve the industry’s reputation and trust levels, which have recently been subject to negative press stories.
This Report explores the buy now, pay later financing market and uses the following definition:
Buy now, pay later financing is a payment option that lets consumers buy products or services without paying the total amount upfront. This means a purchase can be paid off in fixed instalments over time. Some BNPL arrangements do not include any interest for a certain period, although late fees can be applied if repayments are missed. Interest charges can also apply to longer-term agreements.
BNPL services, such as Clearpay and Klarna, are popular among consumers and businesses, particularly online retailers, since they offer convenience and flexibility to consumers, while helping businesses increase sales, boost average transaction numbers, as well as attracting new customers.
Other brands offer alternative regulated instalment credit options, such as Monzo Flex, which provide users with added consumer protection.
This report was written by Lewis Cone. Lewis joined Mintel in May 2013 having graduated from the University of Southampton with a 2.1 BSc (Hons) degree in Economics and writes a range of industrial reports, from occupational health to the house building market.
BNPL is gaining popularity for its simplicity and flexibility, particularly among young and less affluent users. Upcoming regulations aim to enhance consumer protection.
Lewis Cone
Associate Director – Financial Services
Mintel is the world’s leading market intelligence agency. We show you how consumers think today and tomorrow. As a trusted partner to industry leaders, we deliver game-changing insights to businesses across the globe, fuelling their marketing and innovation strategies that will shape the future.
Access high-quality market research with every purchase of Mintel’s consumer reports. Here’s what else is included in your report purchase:
From consumer reports to customised growth strategies. We have an option to suit your business requirements.
Find out more£ 5,000 – £ 21,600
Mintel’s 2024-25 Global Outlook on Sustainability: A Consumer Study is designed to help you understand what brands and companies should prioritise in order to educate consumers and ensure...
Find out more£ 2,195
“Despite the long-term shift towards digital banking, branches still have a role to play for many consumers. Satisfaction levels remain high despite widespread branch closures in recent years....
Find out more£ 1,495
With inflation and interest rates likely to remain elevated, it is important that providers offer suitable advice and products to help companies through these times. Lewis Cone, Associate...
Find out more£ 2,195
Charities are navigating a challenging landscape. Potential donors' finances are still feeling the squeeze, charities face higher operational costs and, for many, higher demand for services from vulnerable...
Find out more£ 2,195
The lingering effects of the cost of living crisis continue to impact the current account market, raising the perceived value of cash incentives for switching. 47% of account...
Find out more£ 2,195
Sustainability is already playing a role in how people choose new banks, and this is likely to grow as climate change progresses. 90% of Gen Z say it...
Find out more
We utilize Mintel Reports, Trends and Comperemedia to mine for insights across the numerous business verticals that Epsilon serves, such as CPG, automotive, telecom, healthcare/pharma, retail and financial services.
By integrating Mintel insight into new business opportunities, we have been able to gain the competitive edge necessary to advance partnerships with global brands and key business players.
For our organization, it’s about depth and breadth. Having one without the other doesn’t enable success in our business.
There is no question that Mintel is the go-to resource for the best quality market research, but I did not think it was an affordable option for Abacus Marketing to consider. As a small marketing agency, we only work with a few new clients each year.
However, we have a very high-end consultative approach to our work, so we really do need a partner like Mintel to provide the big agency experience we are always aiming to deliver. Our clients come from an incredibly diverse range of industry sectors, so we obviously need access to market research reports from a very wide spectrum of marketplaces – and that is precisely what we got.
Mintel is really good for getting a handle on a particular category quickly. If we are working on a new business pitch in an area we don’t have much experience in, it’s a brilliant way to get up to speed with what’s going on, what’s changing and what the key trends are in any category.
It’s very rare now that anyone will plough through a 200-page report – that’s why the summaries are really useful. We know they are backed up by a lot of detail, so if you need to go into something in more depth you know the information will be all there for you.
One of the biggest challenges we face is the need to get smart on a business or category real quick.
We are talking to clients who live and breathe their category every day and the expectation is that we will be able to get caught up very quickly, and bring the thinking that can help them.
We need to do that often in a matter of days, so it’s not a small ask. Mintel gives us a very articulate view of category conditions and does so at the speed we need it.
We use Mintel to inform our thinking and reinforce strategy. If you’re presenting new ideas, it’s essential they are underpinned by robust data and evidence, and clearly rooted in fact.
Mintel gives us all that. It’s a great brand and one that is trusted by clients.
From consumer reports to customised growth strategies. We have an option to suit your business requirements.
Find out more
