3 Lies and a Truth About Buy Now, Pay Later Payments
The explosive growth of buy now, pay later (BNPL) installments has payments and e-commerce professionals buzzing about payments as the fifth “P” of marketing. With consumer demand for BNPL expected to grow 192% by 2024, there are a few common misconceptions that persist about who is using BNPL and what they are using it for.
Lie #1: “BNPL is only used by millennials.”
While many millennials tend to be early adopters and quickly jumped on the BNPL bandwagon for retail items, it’s not accurate to say that “only” millennials are using BNPL.
The truth is that BNPL is being used by consumers of all ages. According to a study from The Motley Fool, in March of 2021, 55.80% of Americans now saying they’ve used one of these services. That’s an increase of 48% in less than a year. And the fastest growing generational cohort adopting BNPL services is actually those U.S. consumers over the age of 54. According to the same study from The Motley Fool, between July 2020 and March of 2021, the percentage of Americans over the age of 54 who used a BNPL service grew 98%.
Lie #2 “BNPL is only for small transaction values.”
BNPL isn’t just for handbags and shoes. Consumers are using BNPL for a wide variety of larger purchases from sporting equipment, to travel, to furniture. Merchants need a flexible BNPL solution that can accommodate small purchases of $50 dollars with 4 payments over 6 weeks all the way up to $25,000 with 24 payments over 2 years. For merchants, the truth is that it’s better to offer a complete range of flexible payment options to address the full spectrum of consumer needs.