BNPL cost of living
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Christmas-Now-Pay-Later On The Cards Amid Cost of Living Crisis

More consumers will be offsetting the cost of Christmas this year by using buy-now-pay-later (BNPL) services as the cost of living continues to rise. 

When compared to last year’s spending habits, 52 per cent of consumers are more likely to or are already using BNPL to offset the cost of living, according to new ECOMMPAY research.

A quarter is found to be more likely to opt for the service, while 27 per cent admitted to already using it. Consumers expect to spend, on average, £293 in total for gifts this Christmas.

And the use of BNPL in higher ticket items was also found to be trending. The research suggests that 27 per cent might use it to purchase a high-value gift, with the average BNPL purchase being £325.

In terms of the availability of the service, a third would abandon purchases without BNPL. Likewise, 31 per cent would look to another shop that did offer the service for the same product.

BNPL and the cost of living

With the cost of living crisis mounting, the research identifies the top three items shoppers would use BNPL for during the festive season. These are electronics at 15 per cent, clothes/shoes at 14 per cent and toys at 12 per cent.

While BNPL has historically been popular among females, the research clarifies the rise of male users.

It anticipates that this trend will continue in 2023, as on average, UK consumers plan to use BNPL for 16 per cent of purchases. This rises to 19 per cent for men and drops to 14 per cent for women.

Younger age groups remain the demographic with the biggest uptake of BNPL services. Accordingly, 16 to 34-year-olds are most likely to use BNPL in 2023, for 30 per cent of purchases.

Regulatory requirements

As the BNPL industry grew quickly and at the beginning of the year, just over half of consumers felt providers needed to be regulated.

To better protect consumers, regulations have since come into effect. Thirty-seven per cent say they are now more encouraged to use BNPL services because of this.

Regulations and financial literacy support remain important elements of responsible BNPL use. The data shows that 58 per cent feel that BNPL encourages them to spend more than they can afford. This figure is up four per cent from the beginning of the year.

Paul Marcantonio, Executive Director UK & Western Europe at ECOMMPAY
Paul Marcantonio, executive director UK and Western Europe, ECOMMPAY

“The data clearly shows the impact of the cost-of-living crisis on consumer spending habits,” says Paul Marcantonio, ECOMMPAY’s executive director for the UK and Western Europe.

“Merchants should look into incorporating BNPL into checkouts if they wish to cater to the needs of consumers during these times,” he continues.

“While regulation is promising for the BNPL industry, this payment method can be a risk for some consumers in terms of debts and its effect on credit scores.

“This may put them in precarious financial situations in the future. Therefore, it is key for merchants and providers to ensure the right checks are in place when providing this payment option.

“It is clear that BNPL offers benefits to merchants and consumers alike, especially during difficult economic times, but it is important, particularly for consumers, to stay financially intelligent when making purchases this holiday season and be aware of the risks.”


  • Tyler is a fintech journalist with specific interests in online banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

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