Buy now pay later (BNPL) statistics

Buy now pay later (BNPL) is currently the fastest-growing online payment method in the UK, with a growth rate double that of bank transfers and more than triple that of digital wallets. Buy now pay later is a service that allows consumers to shop online and place and receive orders while paying for them later.

We carried out some research to see if buy now pay later providers are disrupting the credit card industry and how we pay for products.

Quick overview

What are the most popular buy now pay later companies?

In the first half of 2022, BNPL apps have reached almost 10 million downloads on the Google Play store and Apple’s App Store.

In the UK, Klarna is the most popular BNPL company. In September 2022, the app was downloaded 194,388 times in the UK, and in 2021, its services were used by 150 million customers worldwide.

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• Table

Other than Klarna, there are many other UK BNPL platforms that are growing in popularity. Clearpay is the second most popular BNPL platform, having been used by 25% of BNPL customers in 2021, up from 16% in 2020. These are the 2 most popular BNPL apps, with almost two-thirds (61%) of all BNPL users having bought an item with either one of these platforms.

Openpay (8%), Laybuy (7%), Zilch (7%), Payl8r (4%) and Zip (6%) are other popular buy now pay later platforms, all except for Payl8r saw an increase in their customers in 2021 compared to 2020.

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• Table

What generation in the UK uses BNPL the most?

According to our research, younger generations are far more likely to use buy now pay later services. The generation using BNPL the most is millennials (1981-1996), with 54% using this online payment method. Generation Z is also following this same trend, with 50% saying they use buy now pay later. It’s no surprise that younger generations can’t seem to get enough of BNPL. Klarna, Clearpay and Laybuy are all highly active on social media, marketing themselves to millennials and generation Z through organic and targeted ads to great effect.

Older generations are also using buy now pay later methods, but not to the same extent. For example, only 23% of baby boomers and 12% of the silent generation use these services.

• Graph
• Table

Young shoppers are likely to pay off their BNPL purchases through added borrowing. Over half (51%) of those aged between 18 and 34 years, 39% of 35- to 54-year-olds and 24% of those aged 55 and above have borrowed money to pay off a BNPL debt.

The most popular way BNPL consumers pay off their BNPL purchases is through the money in their current account (52%). Roounding out the top 5 ways to pay off a buy now pay later purchase is by using a credit card (26%), using their savings (23%) and using a bank overdraft (9%).

Just under 1 in 10 (7%) of BNPL consumers have borrowed money from friends or family, 6% have taken out a personal loan, 1 in 20 (5%) have turned to a payday loan and 3% have used a guarantor loan to pay off a purchase.

• Graph
• Table

What type of products do people in the UK purchase through BNPL?

One-third (33%) of BNPL customers have used the service to purchase casual wear clothing. With many online fashion brands such as ASOS, boohoo and SHEIN accepting BNPL services, this is a popular way to afford clothing, especially for the younger generations. After casual wear, eating out is not far behind with 31% of consumers using BNPL to pay for trips to restaurants. These are followed by beauty products, with one-quarter (26%) of consumers paying for these using BNPL services.

Technology purchases (22%), travel (19%) and home improvements (19%) follow. Perhaps worryingly, 14% of consumers use BNPL to pay for their rent.

• Graph
• Table

Why do shoppers use buy now pay later services?

We also analysed the main 6 reasons why shoppers are using buy now pay later services. Our data shows that the main reason that people are using buy now pay later is because of its ease and convenience (44%). The ability to spread costs over time is the next most popular reason (41%), followed by interest-free payments (39%) and the ability to pay for purchases that individuals couldn’t afford otherwise (30%).

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• Table

Criticisms of buy now pay later

The offer of interest-free instalments and no hidden fees allows shoppers more flexibility but also can lessen their perceived risk of debt and lead to overspending and ensuing problems. This has drawn criticism for the BNPL industry from the media and certain charities.

Finder research found that 41% of those who are increasingly using BNPL cited the ability to spread the cost of payment over time as a key factor, while 30% claimed to use it to pay for purchases they can’t otherwise afford.

The FCA is not currently regulating BNPL services (beyond those offering finance) but has said that consumer credit is 1 of 5 priorities for its Business Plan in 2020-21, so it is likely to be monitoring what happens in this area.

• Previous research: Buy Now Pay Later 2020

  Quick overview

  • Almost 4 in 10 (37%) Brits say they have used a buy now pay later service.
  • Over half (52%) of BNPL users are using these services more during the COVID-19 period.
  • BNPL is most popular among millennials, with 54% using this payment method.
  • Klarna was the most popular BNPL app, with 460,000 active monthly users in July 2020.
  • 44% of shoppers use BNPL for its ease and convenience.
  • Online purchases using buy now pay later services are growing at a rate of 39% per year.
  • Almost 10 million (9.5 million) Brits said that they avoided buying from retailers that don’t offer BNPL options at the checkout.

  Which are the most popular buy now pay later companies?

  There are numerous different buy now pay later platforms, but which ones are the most popular? In terms of app downloads in the UK from January 2020 to the end of July 2020, Klarna was the most popular, with 986,000 downloads. This is more than double the number of downloads of My Argos Card (435,000), which was the next most downloaded BNPL app. In third place was Clearpay (298,000), followed by Laybuy (162,000) then Openpay (44,000).

  • Number of app downloads, January-July
  • Table

  Company	Number of app downloads, January-July
  Klarna	986,000
  My Argos Card	435,000
  Clearpay	298,000
  Laybuy	162,000
  Openpay	44,000

  The increasing popularity of buy now pay later

  Online purchases using buy now pay later services are growing at a rate of 39% a year, with market share set to double by 2023. In fact, nearly 9.5 million Brits said that they avoided buying from retailers that don’t offer BNPL options at the checkout. This popularity looks set to continue, with 8.6 million Brits (13%) planning to use BNPL services more in the future.

  The number of UK brands offering buy now pay later options is also increasing, making it a viable way to pay for a lot of goods. For example, Klarna saw a 20% increase in UK brands using its service during April 2020. This is understandable, as BNPL options benefit retailers by increasing customer loyalty and basket conversions and boosting sales by up to 30%.

  The rise of Klarna in the UK

  Klarna is based in Sweden but is growing rapidly in the UK. In March 2020, it announced that it had reached 7 million UK users, twice the amount that it had at the same time last year.

  In the UK, the Klarna app (on both iOS and Android devices) has experienced a substantial increase in monthly active users. In just a year and a half, there has been a 3,143% increase. In December 2018, the app had 14,000 active users per month, and by July 2020, this number had risen to 460,000.

  • Number of monthly active Klarna users
  • Table

  Month	Monthly active Klarna users
  Dec 18	14,196
  Jan 19	17,126
  Feb 19	27,243
  Mar 19	37,130
  Apr 19	49,975
  May 19	75,984
  Jun 19	116,145
  Jul 19	142,602
  Aug 19	127,897
  Sep 19	132,135
  Oct 19	138,941
  Nov 19	214,929
  Dec 19	193,163
  Jan 20	186,190
  Feb 20	237,933
  Mar 20	211,078
  Apr 20	230,068
  May 20	308,400
  Jun 20	406,770
  Jul 20	460,414
  Jul 20	460,414
  Jun 20	406,770
  May 20	308,400
  Apr 20	230,068
  Mar 20	211,078
  Feb 20	237,933
  Jan 20	186,190
  Dec 19	193,163
  Nov 19	214,929
  Oct 19	138,941
  Sep 19	132,135
  Aug 19	127,897
  Jul 19	142,602
  Jun 19	116,145
  May 19	75,984
  Apr 19	49,975
  Mar 19	37,130
  Feb 19	27,243
  Jan 19	17,126
  Dec 18	14,196

  Who is using buy now pay later?

  BNPL is a rapidly growing online payment method, with 37% of Brits saying they have used buy now pay later, according to our research. But who is behind this recent growth? Find out the differences between generations, genders and regions in the UK below.

  Generational differences

  According to our research, younger generations are far more likely to use buy now pay later services. The generation using BNPL the most is millennials (1981-1996), with 54% using this online payment method. Generation Z is also following this same trend, with 50% saying they use buy now pay later. It’s no surprise that younger generations can’t seem to get enough of BNPL. Klarna, Clearpay and Laybuy are all highly active on social media, marketing themselves to millennials and generation Z through organic and targeted ads, to great effect.

  Older generations are also using buy now pay later methods, but not to the same extent. For example, only 23% of baby boomers and 12% of the silent generation use these services.

  • Proportion using BNPL, by generation
  • Table

  Generation	Proportion using BNPL
  Generation Z (1996+)	50%
  Millennials (1981-1996)	54%
  Generation X (1965-1980)	37%
  Baby boomers (1946-1964)	23%
  Silent generation (1928-1945)	12%

  Gender differences

  Our research found that buy now pay later services are more popular with men than women, with 41% of men saying they use them, compared to 33% of women.

  • Proportion using BNPL, by gender
  • Table

  Gender	Proportion using BNPL
  Men	41%
  Women	33%

  Regional differences

  Our research also found that the use of buy now pay later services varies across different regions of the UK. London has the greatest percentage of buy now pay later users, with 48% of Londoners using this payment method. This is followed by residents of the East Midlands (40%) and the South East (38%).

  The region with the lowest percentage of BNPL users is East England, with only 31% of residents ever using buy now pay later services.

  • Proportion using BNPL, by region
  • Table

  Region	Proportion using BNPL
  London	48%
  East Midlands	40%
  South East	38%
  North West	36%
  South West	36%
  Yorkshire and the Humber	36%
  Scotland	35%
  North East	34%
  Northern Ireland	34%
  West Midlands	33%
  Wales	33%
  East England	31%

  Shoppers’ use of buy now pay later during lockdown

  According to our 2020 research, just under two-thirds (63%) of people are not currently using buy now pay later services. This leaves around 19.4 million people (37%) who have used or are using them.

  Of those using this type of payment method, 36% said they are using them the same amount as they were before the lockdown. Over half (52%) of BNPL users are using these services more during the COVID-19 period, with 32% saying they will continue to do so and 20% saying they will use them less often after COVID-19. 12% of BNPL users said they have used these services less over lockdown, but some of these people (4%) said they are likely to use them more in the future.

  • How much are shoppers using BNPL services?
  • Table

  How much are shoppers using BNPL services?	Percentage
  Using them less in lockdown but will use them more often in the future	4%
  Using them less in lockdown and will continue to do so	8%
  Using them more in lockdown but will use them less often in the future	20%
  Using them more in lockdown and will continue to do so	32%
  Using them the same amount as before lockdown	36%

  Why shoppers use buy now pay later

  We also analysed the main 6 reasons why shoppers are using buy now pay later services. Our data shows that the main reason that people are using buy now pay later is because of its ease and convenience (44%). The ability to spread costs over time is the next most popular reason (41%), followed by interest-free payments (39%) and the ability to pay for purchases that individuals couldn’t afford otherwise (30%).

  • Why do shoppers use BNPL services?
  • Table

  Why do shoppers use BNPL services?	Percentage
  They're easy and convenient	44%
  I can spread costs over a longer period of time	41%
  To access interest-free payments	39%
  To pay for purchases I couldn't otherwise afford	30%
  To try on items that are delivered to me before I am charged for them	28%
  I don’t want to use or take out a credit card right now	27%

  Bad news for the credit card industry?

  With job losses and economic uncertainty rife during the COVID-19 period, consumers have been playing their finances safe. For example, credit card spending fell by 50% at the start of the lockdown. While the cancellation of holidays is one plausible reason for the decline, there’s evidence for another, which is that a notable number of consumers were looking to alternative payment options instead.

  Our research found that over a quarter (27%) of Brits who have used BNPL services more recently – or plan to do so – cited not wanting to use or take out a credit card as a reason for choosing these services. There was a difference between generations as well, with a third (31%) of generation Z citing this as a reason, compared to under a quarter (23%) of generation X.

  Additionally, we found that barely half of millennials own a credit card (51%), compared to 71% of generation X. Of the millennials who don’t have a credit card, 93% never plan to take one out.

  • 27% of Brits who use buy now pay later services cite not wanting to use a credit card as a reason.
  • Around half (49%) of millennials don’t own a credit card.
  • Of those millennials who don’t own a credit card, 93% plan to never take one out.

  Millennials and generation Z have definitely shown an aversion to credit and a willingness to adopt alternative payment methods, particularly BNPL. Younger generations look at this payment method as a budgeting tool, and many see credit cards as an easy way to get into debt.”

• Sources

  Sources

  • Finder-commissioned nationally representative survey of adults aged 18+ (2020)
  • European Payments Council
  • YouGov
  • Klarna
  • Harris Interactive
  • European Payments Council
  • Sensor Tower
  • Airnow
  • WorldPay
  • UK Finance report

• Methodology

  Finder Survey Methodology

  • Finder commissioned OnePoll to carry out a nationally representative survey of adults aged 18+.
  • A total of 2,000 people were questioned throughout Great Britain, with representative quotas for gender, age and region.

For all media enquiries, please contact

Matt Mckenna
UK communications manager
T: +44 20 8191 8806

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