BNPL Finds an Audience Among Super-Prime Shoppers

Consumers who spread their purchases across several buy now, pay later (BNPL) providers are also the ones most prepared to pay for something BNPL was built to avoid: interest. That distinction may impact how far the product can move beyond Pay in 4.

The PYMNTS Intelligence report “Beyond Pay in 4: Many BNPL Buyers Would Pay for More Time,” the August edition of The Pay Later Ecosystem Report, found that among BNPL consumers who use four or more providers, 82% said they would pay interest in exchange for access to a longer repayment schedule. Among consumers who use only one provider, the share fell to 46%. Users of two or three providers sat between them at 70%.

The gap suggests that BNPL’s most active customers could provide a natural market for longer-duration credit. They already use multiple providers, and their willingness to accept interest indicates that at least some are looking for how long they have to repay.

Across the entire sample, two-thirds of BNPL users said they would pay interest for access to a longer-term plan, while 14% said they would not, and 21% neither agreed nor disagreed. The numbers give providers reason to consider longer-term, interest-bearing plans as a mainstream consumer credit product rather than a specialized extension of Pay in 4, the report said.

Engagement Changes the Credit Equation

The difference between the 82% of heavy multi-provider users and the 46% of single-provider users adds another layer to that opportunity.

Using several BNPL providers does not, by itself, establish why a consumer wants longer repayment periods. There is a strong relationship between breadth of BNPL use and willingness to pay interest for additional repayment time.

Purchase size reinforces the pattern. For purchases less than $100, 54% of BNPL users would pay interest for a longer schedule. The share was 58% for purchases from $100 to $499, then rose to 79% when purchases reached $500 to $999. For purchases of $1,000 or more, it remained high at 76%.

Providers, then, have two signals to work with, including how extensively a consumer already uses BNPL and how much the consumer is financing. The report identified purchases above $500 as a particular opportunity for extended-term plans.

Credit quality also complicates the conventional picture of who might want more time. Among super-prime BNPL users, 76% would pay interest for longer repayment schedules, compared with 64% of prime users and half of subprime users.

The clearest solution identified in the report was greater choice in repayment periods. According to the report, 88% of BNPL users said they want the ability to choose how many payments they use to split a purchase, while only 4% disagreed. Pay in 4 remained the most common structure and was used by 55% of BNPL consumers in the United States, but 45% said they already use something longer.

For providers, the 82%-to-46% gap helps identify where that choice may find its most receptive audience. The consumers already moving among several BNPL providers appear more willing to pay for additional time than those whose BNPL relationship stops with one.

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