Buy Now, Pay(Pal) Later

In times of high prices, high interest rates and high economic uncertainty, the “Buy Now, Pay Later” model has emerged as a popular alternative to credit cards or other digital payment methods. According to FIS’ Global Payments Report 2023, BNPL accounted for 5 percent of global e-commerce transaction volume last year and is expected to grow at a CAGR of 16 percent between 2022 and 2026.

According to FIS more than 200 global providers now offer installment loans at checkout, as specialized fintech companies such as Klarna and Afterpay are competing with established digital payment providers, banks, tech giants and credit card companies in the still nascent BNPL market.

According to Statista Consumer Insights, PayPal with its interest-free “Pay in 4” option is the most popular BNPL provider in the U.S. right now, with 68 percent of surveyed BNPL users saying they used PayPal’s Buy Now, Pay Later option in the past 12 months. Afterpay comes second with a reach of 25.9 percent, followed closely by Affirm and Klarna, which were used by 21.9 and 21.5 percent of BNPL users, respectively.

PLEASE NOTE: A previous version of this chart mistakenly listed Amazon Pay Later as an option. However, Amazon is working with Affirm in the U.S. to offer its customers a Buy Now, Pay Later checkout option.