Buy Now, Pay Later industry gaining in popularity

The Buy Now, Pay Later industry has exploded in recent years, with up to 71% of usage for online purchase, according to a Reach3 Insights report.

A 10-minute survey to understand consumer sentiment on Buy Now Pay Later and its growth and challenges was fielded between Aug. 31 and Sept. 8, 2022, using conversational language, and selfie videos to capture honest, real-time feedback and reactions to gauge shopping and purchase habits, perceptions and preferences and future intent for Buy Now, Pay Later payment options.

Key findings from the report include:

• Buy Now, Pay Later usage for online purchases continues to grow, particularly for those making large transactions or buying luxury/non-essential items;
• Frequency of Buy Now, Pay Later usage climbs as more retailers and industries implement the payment option;
• Top items/categories are on the higher-end of commodities that typically already offer some form of financing via store credit cards or installment plans;
• Convenience and being able to buy items one could otherwise not afford are top reasons for use; rewards and remaining debt free are top barriers;
• Credit checks are seen as a necessary component of the service, though few prefer having hard credit checks;

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• Three-fourths of Buy Now, Pay Later users indicate having a positive experience, which jumps significantly each time the payment option is utilized;
• Sixty-eight percent of all Buy Now, Pay Later users (combined BNPL Only and Sometimes) indicate intent to re-use in the next year and one-fifth of non-users also plan to use it for a future purchase;
• Non-users of Buy Now, Pay Later indicate the greatest negative impact for a hard credit check on purchase intent;
• Additionally, those who have not used Buy Now, Pay Later feel least confident in their understanding between hard and soft credit checks;
• Occasional users of Buy Now, Pay Later indicate the strongest preference for soft credit checks; few prefer hard credit checks regardless of experience with Buy Now, Pay Later;

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• Generally, BNPL is most used for clothes and electronics purchases, though conversion is highest for furniture purchases;
• Convenience and being able to buy items one could otherwise not afford are top reasons for use; rewards and remaining debt free are top barriers;
• Specifically, the flexibility offered by Buy Now, Pay Later is notably appreciated by those with a credit score of less than 500; and
• Users generally indicate having a very positive experience with Buy Now, Pay Later.

To view the report click here.