Consumers are returning to in-store shopping with new, higher standards for their experiences and a growing interest in stretching their dollars by using emerging payment methods such as buy now, pay later (BNPL) plans. As consumer interest in BNPL grows, especially among individuals in large cities and urban areas, startups and younger companies are leveraging the appeal of affordable installment plans to gain an edge in America’s most competitive retail markets.
The July edition of the “Buy Now, Pay Later Tracker®” reveals how 2020’s digital shift has ignited renewed consumer interest in flexible payment alternatives at checkout. It also examines why many consumers are tapping the method to purchase big-ticket items and to make purchases from online marketplaces, areas in which
BNPL solutions are experiencing significant adoption.
Around The BNPL Space
Consumers’ interest in BNPL solutions is driving major retailers around the globe to begin new partnerships with various providers. Installment payment solution provider Afterpay, for example, recently added Amazon, Nike, Nordstrom and Sephora, among others, to its roster of retail partners. Consumers can use the Afterpay app to shop at these stores and then pay for their purchases in four installments. Retailers appear to have good reason for forging these partnerships: Afterpay noted that consumers who pay in installments tended to spend more than those who do not.
BNPL’s rising popularity is also having an effect on how retailers view the option and their plans to incorporate it for customers. Despite the fact that 32 percent of BNPL users are consumers who have faced financial challenges, one recent survey showed that overall consumer usage of BNPL options has increased by 50 percent in under a year. This indicates that the payment method is finding favor with consumers of all stripes who are looking for flexible, convenient solutions in stores and 
online.
Consumers across all demographics are growing fonder of BNPL solutions, but new research suggests that younger consumers are still the primary driving force behind their expansion. A new study estimated that 45.1 million consumers will use BNPL by the end of this year, representing an 81 percent year-over-year increase. It found that millennials account for 43 percent of all installment payment plan users, with Gen Z consumers representing 30 percent.
For more on these and other stories, check out the Tracker’s News & Trends section.
Gender-Neutral Clothier Dapper Boi On Tapping BNPL To Meet Consumers’ Financial Needs
Fashion is all about personal choice, and it is imperative for clothing retailers to make sure that consumers can buy the styles they want using flexible payment methods. According to Charisse Pasche, cofounder of gender-neutral clothing label Dapper Boi, more customers are turning to BNPL to purchase the fits they seek without going over their budgets. In this month’s Feature Story, Pasche discusses how BNPL solutions factor into the company’s approach to inclusivity.
Deep Dive: How Online Marketplaces, Big-Ticket Sales Are Driving BNPL’s
Business Impacts
Consumer demand for BNPL plans is driving growth in multiple sectors, with online aggregators and marketplaces showing the highest levels of customer interest. Consumers who have permanently shifted many of their routine shopping activities to digital channels are natural audiences for BNPL services, but in-store purchasing is also back in play. This month’s Deep Dive examines the retail shifts driving consumers’ usage of BNPL plans and details what merchants must do to meet their needs.
About The Tracker
The “Buy Now, Pay Later Tracker®,” a PYMNTS and Afterpay collaboration, brings you the latest news and research from the buy now, pay later space. The July edition examines how installment payment plans have led to sales growth in certain industries as well as the method’s broader adoption in the retail space.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
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