BNPL Tracker: 30% of Americans Considering Buy Now, Pay Later Loans This Month
Three in 10 consumers (30%) say they’re at least considering using a buy now, pay later (BNPL) loan this month, according to the March 2024 LendingTree BNPL Tracker.
Each month, the LendingTree BNPL Tracker asks Americans if they plan to apply for a BNPL loan this month and how confident they feel about paying it off without missing a payment. We also ask how often consumers expect to apply for a BNPL loan in the next six months. (See the tracker methodology below.)
We’ll update this page as new data emerges.
How many Americans expect to use buy now, pay later loans this month?
The March 2024 LendingTree BNPL Tracker finds that 30% of Americans are considering applying for a BNPL installment loan this month. That’s down one percentage point from February. This month’s percentage includes 14% who say they’ll apply and 16% who say they might.
Additionally, 39% of Americans say they expect to apply for a BNPL loan at least once in the next six months — unchanged from February. That 39% includes 12% who say they expect to do so at least three times in that period.
How many Americans have been late with a payment on a BNPL loan?
A LendingTree survey of BNPL loan users conducted in March 2023 and published in April 2023 found that 40% of them have made a late payment on one of the loans.
That’s a big percentage. However, it makes sense based on consumer confidence levels in our monthly BNPL Tracker.
Meanwhile, 36% say they’re only somewhat confident, up four percentage points from February.
While that adds up to 85% of people feeling at least some confidence about paying off BNPL loans on time, it still means a significant number of people take out these loans with doubts about whether they’ll be able to pay them back without incident. That’s far from ideal.
Just 3% say they aren’t confident (either somewhat or very), while 12% say they’re neither confident nor unconfident.
How much do people spend with buy now, pay later loans?
The average purchase amount of a BNPL loan is $132, according to an April 2023 report from Experian.
However, there’s no question that BNPL is used for a huge variety of items at a wide range of prices. For example, the 2023 LendingTree survey showed that consumers used the loans for everything from groceries and dining out to travel, technology items and home décor.
What are some of the most popular buy now, pay later services?
BNPL is a crowded field with many players — including Apple, which launched its Apple Pay Later service in March 2023 — but these four were clearly among the most used, according to the 2023 LendingTree survey.
More than half of all BNPL users said they’ve used PayPal (55%), while 33% have used Klarna, 29% have used Afterpay and 28% have used Affirm. None of the other firms we asked about were used by more than 10% of respondents.
All four companies offer BNPL apps, but their services can also be used through web browsers — often through retailers’ online checkout pages.
What do you need to know before getting a buy now, pay later loan?
If you’re one of the millions of Americans who’ve tried BNPL loans — or if you’re among the millions more likely to consider them in the near future — here are some key things to keep in mind:
- You may be asked to pay every two weeks. With most loans, consumers are required to pay monthly. However, with many BNPL loans — especially those of the “pay-in-four” variety — you’ll be expected to pay every two weeks. Typically, BNPL lenders require you to connect a debit or credit card to your account when you first use it so that payments can be pulled automatically when they’re due. You’ll need to make sure you have sufficient funds or available credit on the due date to ensure the automatic payment is successful.
- Many (but not all) BNPL loans are interest-free. Pay-in-four BNPL loans are often interest-free if you pay them on time. However, longer-term buy now, pay later loans can have interest rates as high as 30%, rivaling the highest credit card rates. Make sure you understand the rates before applying, because what you don’t know can cost you.
- Your credit may or may not be affected. Your mileage may vary greatly by lender when it comes to handling credit. That’s true both in terms of approving folks for loans and reporting payment histories. Some require soft credit checks, while others do nothing. Some will charge late fees and report missed payments to credit bureaus, while others won’t — and it can sometimes be a challenge to find this information. BNPL loans aren’t subject to specific disclosure requirements like credit cards, but it’s worth your time to seek this information.
- You have other options. Buy now, pay later loans can be great tools. They’re often interest-free, with predictable payment schedules and no extras available that can draw people into debt — but they’re not always the best option. Credit cards provide long-term available credit, typically more lucrative rewards and important consumer protections that BNPL doesn’t. Zero-percent balance transfer cards and low-interest personal loans allow you to consolidate and refinance debts. Even store credit cards, when used wisely, can provide targeted rewards and discounts that can be a good deal for the right customer.
- Don’t rush into it. People make bad decisions when rushed and don’t understand what they’re getting into — and money is no exception. Before you apply for that BNPL loan, click the “learn more” or “more info” button on the retailer’s checkout page. Make sure you understand the basics — interest rates, payment schedules, credit checks, fees — before applying. You’ll be glad you did.
LendingTree BNPL Tracker methodology
LendingTree commissioned QuestionPro to conduct an online survey of 2,026 U.S. consumers ages 18 to 78 from March 1 to 5, 2024. The survey was administered using a nonprobability-based sample, and quotas were used to ensure the sample base represented the overall population. Researchers reviewed all responses for quality control.