Buy-now-pay-later (or post-purchase-payments) is where you pay for something in small instalments over a set period of time.
It’s becoming the Number One choice when consumers have an urgent need to replace or purchase something, but don’t have the cash to pay up-front. Afterpay and Klarna are some popular examples you might have heard of.
Buy Now Pay Later is becoming a common payment method at some high-street shops, but it’s more commonly used by catalogues and online retailers. Their products are often aimed at young people and families, with discounts, if you use the #BNPL service on shops such as H&M and Coach.
The global BNPL platforms market was valued at over £5.2 billion in 2019 and is expected to reach over £24 billion by 2027. A new report commissioned by Klarna has revealed that BNPL accounted for almost 4% of all online retail sales in the UK in 2020 with over 10 million users.
Paying in instalments is not a new concept. Gen Z and Millennial generations are demanding choice and tend to be more careful about using traditional credit cards. The current economic climate is expanding the audience for instalment plans to Gen X and Baby Boomer shoppers who might previously have been uncomfortable with the idea.