Paycheck-to-Paycheck Consumers More Than Twice as Likely to Use BNPL

As shoppers look for financial tools to help them manage their budgets, those who are struggling to make ends meet are more likely to adopt buy now, pay later (BNPL) options than their financially stable counterparts.

By the Numbers

The PYMNTS Intelligence report “Redefining Retail: Consumer Finance Trends Driving the Evolution of Pay Later Plans” drew from a survey of more than 2,600 United States consumers to understand how and why shoppers were using various types of installment plans. When it comes to BNPL, the study noted higher adoption among those facing economic challenges than those with a financial safety net. Specifically, 26% of those who live paycheck to paycheck with difficulties paying their bills said they were very or extremely likely to use BNPL in the next 12 months. A slightly lower 21% of those who live paycheck to paycheck without difficulties paying their bills said the same. For consumers not counting on their next paycheck to get by, that share dropped. Only 10% of those who do not live paycheck to paycheck reported that they expected to use BNPL in the next year.

The Data in Context

BNPL payments are becoming more common, but the regulatory environment is in flux. Last month, Adobe Commerce announced the ability for merchants to offer their customers Klarna’s BNPL services. Since the start of the year, Klarna has also rolled out partnerships with Uber, Expedia and travel retail brand Away, among others. Meanwhile, the Consumer Financial Protection Bureau (CFPB) ended its commentary period for its proposed BNPL regulations, leaving questions about what companies will have to do to comply with new obligations to consumers and when. As BNPL services gain traction among consumers, particularly those facing financial hardships, the evolving regulatory landscape will play a role in shaping the future of these payment options.