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Report
en_GB
BNPL hits the credit sweet spot by offering flexibility without the baggage. As adoption continues to grow, however, its risks become more prominent: Nearly 60% of consumers say that they…
US
Banking and Payments
simple
US Buy Now, Pay Later Market Report 2025
"BNPL is evolving from a convenience tool into a core credit product, and its next chapter will test providers' ability to adapt to shifting payment preferences and cash flow demands."
Amr Hamdi, Senior Analyst - Financial Services
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EXECUTIVE SUMMARY
What you need to know
Credit card financing is finding a larger audience with young adults, but older generations have pulled back
Graph 1: usage of BNPL through a credit card, by generation, 2023-25
Reframe the BNPL proposition to resonate with young consumers
Lower-earners are the most likely to have used BNPL for groceries – shifting its role as a tool for alleviating financial stress
Graph 2: types of products or services bought through BNPL in the past year, by household income, 2025
Providers must balance financing convenience and responsibility across essential spending
Debit-linked BNPL can deepen loyalty with young customers and catalyze cross-sell opportunities
Graph 3: attitudes toward bank BNPL, by generation, 2025
Market predictions
Opportunities
The convenience of BNPL still comes at a cost
Graph 4: spending behaviors using BNPL, by generation, 2025
Embedded guardrails can help users make better-informed decisions
Make education one with the user experience
MARKET DYNAMICS
Market context
Market drivers
Stable BNPL growth bodes well for sustained customer loyalty
Graph 5: BNPL usage in the past year, 2025
BNPL repayments are on course to reshape modern credit scoring
Tariff-driven pressures will see BNPL act as a financial lifeline for vulnerable consumers
Graph 6: headline CPI and core CPI, 2021-25
CONSUMER INSIGHTS
Consumer fast facts
BNPL adoption
BNPL is a young person’s game
Graph 7: BNPL usage in the past year, by generation, 2025
PayPal and pure-plays dominate the bulk of BNPL customer base
Graph 8: usage of BNPL providers in the past year, 2025
BNPL has different leaders for different generations
Graph 9: usage of BNPL providers in the past year, by generation, 2025
Credit card BNPL can help capture more super prime and prime business
Graph 10: usage of BNPL providers in the past year, by self-reported credit score, 2025
BNPL category usage and interest
BNPL is moving beyond standard discretionary spending into essential expenses, raising the stakes
Graph 11: types of products or services bought through BNPL in the past year, 2025
BNPL can serve as a lifeline for medical costs
Graph 12: interest in using BNPL for healthcare, by financial situation, 2025
BNPL consideration enters the home
Graph 13: interest in using BNPL for home improvement, by generation, 2025
BNPL for travel finds steady appeal across young and old
Graph 14: interest in using BNPL for travel, by generation, 2025
Reasons for using BNPL
Ease and control drive BNPL adoption
BNPL’s appeal shifts with age
Graph 15: reasons for using BNPL, by generation, 2025
Subprime consumers look to BNPL as a safety net, heightening repayment risk
Graph 16: reasons for using BNPL, by self-reported credit score, 2025
Average purchase price for BNPL usage
Issuers must position themselves as being the optimal choice for big-ticket spenders seeking both convenience and value on larger transactions
Graph 17: average purchase price consumers would use BNPL for, 2021-25
Big-ticket BNPL remains an area issuers can capture older business through
Graph 18: average purchase price consumers would use BNPL for, by generation, 2025
Regrets using BNPL
Regrets about using BNPL are on the rise
Graph 19: BNPL regrets, 2023-25
BNPL regret is surprisingly not a symptom of financial strain
Graph 20: BNPL regrets, by financial situation, 2025
Payment friction and plan inflexibility are the main drivers of BNPL regret
Graph 21: reasons for BNPL regrets, 2023-25
BNPL behaviors and attitudes
BNPL’s transparency has been critical in winning over the trust of young adults
Graph 22: trust in BNPL providers vs credit card issuers, by generation, 2023-25
Consumers’ proclivity to BNPL signals a future of more dynamic payment preferences
Graph 23: attitudes toward BNPL versus credit cards, by generation, 2025
BNPL is not overtaking credit cards anytime soon, but issuers can still take steps to ensure that their BNPL offerings become top-of-wallet
Partnerships will define the next phase of growth for BNPL providers
Graph 24: BNPL accessibility, by generation, 2025
The saturation of the BNPL market necessitates greater differentiation through partnerships and broader financial products
Graph 25: openness to signing up with multiple BNPL providers, by generation, 2025
INNOVATION AND MARKETING STRATEGIES
Marketing and advertising
Amex leverages comparative advertising to highlight how it stands out from other BNPL providers
Affirm’s Pay in 30 takes the flexibility of BNPL to newer heights
Chase takes the fight to pure-plays with its debit-linked BNPL offering
Klarna’s Apple Pay integration highlights the importance of embedded convenience in the BNPL race
APPENDIX
Market definition
Consumer research questions
Consumer research methodology
Generations
Abbreviations and terms
US BNPL Industry – Trends and Insights
Buy Now, Pay Later hits the credit sweet spot for many US consumers by offering flexibility without the baggage. As adoption continues to grow, however, its risks become more prominent: Nearly 60% of US consumers say that they have spent more than they could afford because of BNPL.
Ultimately, BNPL is a debt product that comes with the standard regrets and dangers. Overextension, delinquency/default, and fragmented payment obligations are still common experiences for BNPL’s engine of younger users. This, in turn, raises the risk that this group ends up on the same trajectory as their older, credit card-burdened counterparts – just repackaged in a more polished, modern form.
BNPL’s next chapter is one that will be built on smarter and more proactive design; embedded guardrails that educate and prevent overextension are brand differentiators that will help ensure a more sustainable model for providers and consumers.
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