The leading providers of buy now, pay later plans have won over American millennials, the generation most likely to use the financing alternative to credit cards. Now it’s the credit scores and annual incomes of BNPL’s U.S. users that distinguish Affirm, Klarna, AfterPay and PayPal in 4.
The industry has largely moved beyond its origins of catering to low-income consumers and shoppers with risky credit profiles. Overall, U.S. BNPL shoppers with prime credit scores and super-prime scores are more likely to use three providers—Affirm, AfterPay and PayPal Pay in 4—compared to subprime consumers.
In general, BNPL has garnered a more financially stable demographic. Consumers earning less than $50,000 a year are the least likely income group to use any of the four providers, as measured by their shares of users. Higher earners making more than $150,000 or $100,000 to $150,000 a year and who use BNPL prefer Affirm.
BNPL by Generation
New PYMNTS Intelligence data shows that millennials, now aged 30–45, are the biggest users across Affirm, Klarna, AfterPay and PayPal Pay in 4. Affirm leads, with 51% of millennial BNPL users choosing that provider in the last three months, making it the BNPL platform of choice for six-figure households.
Born between 1981 and 1996, these consumers are more likely to be managing mortgages, childcare, and car and student loan payments and to find that spreading out payments for certain purchases in fixed installments over a set period of time allows them to afford purchases they otherwise couldn’t. The other benefit: a clear view of the payoff schedule, something generally not available for revolving credit card balances.
By contrast, Gen Z, the oldest now aged 29, uses BNPL at relatively lower rates. That’s significant because this cohort is widely seen as the future of consumer spending. Born between 1997 and 2009, Gen Z is most likely to use Affirm, with more than one in three BNPL users in that cohort (36%) choosing that provider. Gen Z is least likely to use PayPal Pay in 4, with just over one in four (26%) of BNPL users in that age group tapping that provider. One reason may be that these younger consumers typically have less weighty financial needs due to their life stage and just starting their earning careers, and thus less urgency to tap additional credit sources.
But something else is also at play. Nearly three in four Gen Zers (73%) reported living paycheck to paycheck at the start of 2026. Their main reasons were not earning enough to cover their monthly bills, having an income that varied month to month (39%) or financially helping family members (25%).
Fewer than one in four blamed their tight pocketbooks on unnecessary spending. Yet they still use BNPL at rates closer to those of baby boomers and seniors than millennials for every provider except AfterPay. It’s a sign of many Gen Zers’ financial discipline, and a counterpoint to popular narratives that they’re impulsive spenders. Prior PYMNTS Intelligence research showed that Gen Z uses BNPL as a budgeting and credit management tool rather than to fund discretionary splurges.
BNPL Users by Credit Scores
Prime consumers (with credit scores of 620-720) and super-prime consumers (scores of more than 720) are the dominant users of Affirm, AfterPay and PayPal in 4. Super-prime BNPL shoppers are the least likely to use Klarna, which has 37% of all super-prime BNPL consumers.
Klarna tells a different story. It’s the only provider with subprime consumers among its top users. Still, it’s complicated. Nearly as many subprime BNPL consumers use Klarna (41% of all subprime BNPL shoppers) as prime BNPL consumers (42% of all prime BNPL shoppers). In other words, providers can attract both stable and financially risky consumers. Case in point: Despite having the strongest toeholds with prime and super-prime consumers, more than one-third of subprime users of BNPL tapped Affirm in the last three months.
PayPal Pay in 4 has the lowest share of the subprime market, with 21% of subprime BNPL consumers using that provider.
BNPL Users by Annual Income
Overall, higher earners are more likely than lower earners to tap BNPL. Affirm is the winner here, with half of BNPL shoppers making more than $150,000 a year using that provider. The rate rises to 55% for households with $100,000 to $150,000 in annual income—the sweet spot for Affirm. Overall, Affirm is a higher-income product.
Consumers earning more than $150,000 a year are the least likely to use PayPal Pay in 4 (41% of BNPL shoppers making that level).
Klarna garners more than four in 10 BNPL shoppers making more than $150,000 a year. But it also has an identical sweet spot with middle-income BNPL consumers making $50,000 to $100,000 a year.
Methodology
“New Data: Millennials Lead a More Affluent BNPL Market” draws on the July 2026 wave of the PayLater Ecosystem Report, a PYMNTS Intelligence series that has tracked consumer Pay Later use since April 2025. The findings are based on a July 2026 survey, using a subsample of 235 U.S. adult respondents who reported using BNPL in the last three months.
