Buy now pay later BNPL
Insights North America Paytech

Only 14% Of BNPL Users in the US Haven’t Had to Pay a Late Fee Finds ConsumerAffairs

Buy Now Pay Later (BNPL) has established itself as one of the primary ways for people to make payments in 2022. The pandemic caused many to become much more financially aware, leading to a massive uptake in alternative payment methods as people looked to stretch their available finances. For better and for worse, this saw a rise in BNPL.

Research from ConsumerAffairs, an American customer review and consumer news platform, looked to uncover how Americans felt about the payment method. It surveyed 1,000 Americans about their experience or lack thereof with buy now, pay later services. 700 respondents were BNPL users, and 300 had never used these services. Among its respondents, 21 per cent were Generation Z, 32 per cent were millennials, 27 per cent were Generation X and 20 per cent were baby boomers.

Aggregate use of BNPL

To begin the study, ConsumerAffairs first asked respondents about their preferred usage of BNPL, comparing the different generations’ responses. They shared their favorite apps, frequency of use and overall sentiments regarding the payment option.

It’s no wonder BNPL is raking in hundreds of billions of dollars and expected to pull in even more; 80 per cent of those surveyed had used it for the first time within the last year alone. People also habitualised paying later with gusto: 44 per cent used BNPL weekly or more frequently. Only 10 per cent said they employed the payment option once a year or less.

Despite BNPL being a relatively new offering, baby boomers were enthusiastic adopters from the beginning. Unlike millennials or Gen Zers, one in four of those between 57 and 75 years old had already been using BNPL for a year or longer.

Interestingly, those using BNPL the most frequently didn’t have the poorest financial health, on average. It was actually those who used BNPL sporadically — just every few months — that had the worst situations. Perhaps holding on to cash for longer is financially advantageous in this particular economy of high inflation and market-dip buying opportunities.

What people are buying now and paying for later

This next piece of research digs into the specifics behind BNPL. Respondents shared what they’re purchasing, how much they’re spending and what types of late fees they owe. Once again, responses were further compared by generation.

Gen Z respondents were the most likely to agree with the statement that inflation has directly contributed to their use of BNPL — and well over half of respondents of all ages agreed. With deferred payments, increasing inflation can lower the amount you ultimately owe. Then there’s the fact that wages have not kept up with inflation — more than one in 10 respondents said they wouldn’t have made a specific purchase without BNPL.

It might be concerning to see Gen Z adapting to this phenomenon the most. It’s reminiscent of the circumstances around the CARD Act of 2010, when college students were preyed upon by credit card companies offering swag, gifts and other inducements on college campuses. Since then, there’s been a steep drop in the number of young adults signing up for credit cards. Instead, it appears they’re opting for BNPL, which mirrors the concept of a credit card.

Currently, Gen Z is racking up the most in late fees, with an average of $483 during their tenure using BNPL.

Future estimations of BNPL

The study wraps up with a look at future approximations of BNPL. Respondents were asked to share what they felt were the pros and cons of the service and which types of products and services they’d like to see BNPL options for.

BNPL ultimately offered more upsides than downsides, according to respondents. They liked the option for its convenience (70 per cent) and low interest rates (33 per cent) — and also because it doesn’t require a high credit score (31 per cent). The perceived downsides were unknown fees (54 per cent), difficult payment tracking (47 per cent) and a lack of rewards or cash-back incentives (46 per cent).

Most respondents wanted BNPL options to extend even further. Nearly half (48 per cent) said the option is particularly helpful during a recession, and more than a third wanted the payment plans to be extended to health care.

With consistent proof that more money actually can lead to more happiness (or at least a life with less stress), this study suggests that having the actual money on hand might not be as important as having access to it through financing options. People who rated their financial health, mental health and quality of life as good or amazing in this study reported higher median fees, on average, suggesting the later (higher) payments could ultimately be worth it.

Using BNPL to your advantage

BNPL offers a trove of possibilities for your financial well-being — if used correctly. Respondents who took advantage of the option with regularity were actually more likely to be happier and financially healthier, even if they were paying higher fees. Particularly during a recession, this option provides access to items people need the most. Of course, those who benefited most probably didn’t do much frivolous spending.


  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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