Another possible contributing factor is the loan behavior of the typical BNPL borrower. The same study from the CFPB found that BNPL borrowers in the US were more than twice as likely to have at least one reported delinquency on another loan than non-borrowers. They also had much higher usage rates of other loan products, along with subprime credit scores. However, as Consumer Finance points out, “The report cannot distinguish whether Buy Now, Pay Later usage leads to more delinquencies on other obligations or whether consumers who are already in distress are more likely to use Buy Now, Pay Later loans to pay off higher-interest debt.” It’s also important to remember the larger economic context fueling BNPL usage. The globe is in the midst of ongoing uncertainty. Both developed and emerging markets are grappling with cost-of-living crises. Inflation is high. Delinquencies across consumer lending are the highest they’ve been in over a decade. It’s not just BNPL. So how is the industry bouncing back? Read on to discover what the future could look like.
PERCENT OF AGE GROUPS THAT USED BNPL
Age 65+ Age 51-64 Age 35-50 Below age 35
0%
10%
20%
30%
12
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