Buy Now, Pay Later Growth Surges—A Rising Concern for All

**Buy Now, Pay Later Growth Surges—A Rising Concern for All**

The “buy now, pay later” (BNPL) industry is experiencing a s...

The “buy now, pay later” (BNPL) industry is experiencing a surge in adoption and transaction volume, but its rapid expansion is raising alarms among regulators, economists, and consumer advocates. Once seen as a niche alternative to traditional credit, BNPL services are now embedded in the shopping habits of millions, fueling both convenience and concern as the sector matures and its risks become more apparent.

According to recent forecasts, BNPL will surpass 100 million...

According to recent forecasts, BNPL will surpass 100 million users globally by 2027, with transaction value expected to grow by 15% in 2025 alone. The average BNPL user is now spending more than ever—per-user spend topped $1,000 in 2024 and is projected to reach $1,380 by 2028. This growth is driven by broader acceptance in physical stores and expansion into higher-ticket categories like travel, healthcare, and home appliances.

Despite the slowing pace of user growth, the amount consumer...

Despite the slowing pace of user growth, the amount consumers are spending through BNPL continues to climb. More than a quarter of U.S. consumers have used BNPL to finance purchases, with adoption highest among younger shoppers: 41% of those aged 16–24 and 39% of those aged 25–34 have used the service. High-income households are also major adopters, but BNPL is increasingly popular among lower-income groups, who may be more vulnerable to financial strain.

The convenience of BNPL—splitting payments over weeks or mon...

The convenience of BNPL—splitting payments over weeks or months with little to no interest—has made it a go-to option for everything from electronics and furniture to groceries and holiday shopping. Surveys show that 72% of Americans plan to use BNPL in the coming year, and younger generations are especially likely to use it for experiences like travel and concerts.

But this surge in popularity comes with growing concerns. A...

But this surge in popularity comes with growing concerns. A 2022 report from the Consumer Financial Protection Bureau (CFPB) found that BNPL loans grew from $2 billion in 2019 to $24.2 billion in 2021, a staggering 1,092% increase. While the growth rate has since slowed, the market continues to expand, with total issuance from top lenders estimated at over $36 billion in 2024.

The risks are real. More than a third of consumers say they...

The risks are real. More than a third of consumers say they spend more than they would have without BNPL, and 30% admit to buying products they wouldn’t have otherwise purchased. BNPL users tend to be younger, have lower credit scores, and are more likely to be financially stressed. For these consumers, BNPL can lead to overextension, debt stacking, and long-term financial harm.

“There’s barely any data or regulation on this emerging mark...

“There’s barely any data or regulation on this emerging market,” said Jessica Kushner, a consumer advocate featured in a recent On Point segment. “Consumers do benefit from the convenience, but there are real harms that we are already seeing.”

The lack of regulation is a major concern. Unlike traditiona...

The lack of regulation is a major concern. Unlike traditional credit cards or loans, BNPL services are not subject to the same consumer protections. There is limited oversight of lending practices, and many consumers do not fully understand the terms or consequences of their BNPL agreements. This has led to calls for greater scrutiny and regulation, with some policymakers urging the industry to curb its rapid expansion.

Morgan Stanley’s midyear economic outlook warns that if BNPL...

Morgan Stanley’s midyear economic outlook warns that if BNPL usage grows rapidly while consumers face elevated inflation and slow income growth, it could be a warning sign of broader financial stress. The average BNPL loan balance is around $760, but this varies widely by income level, with higher-income households carrying larger balances.

As BNPL becomes a fixture in the retail landscape, businesse...

As BNPL becomes a fixture in the retail landscape, businesses and policymakers are grappling with how to balance innovation with consumer protection. For now, the industry’s growth shows no signs of stopping, but the risks are becoming harder to ignore.

“BNPL remains an important financing tool for consumers,” sa...

“BNPL remains an important financing tool for consumers,” said an eMarketer analyst, “but its high-growth days are in the past. The focus now is on responsible expansion and ensuring that consumers are not left vulnerable to the pitfalls of easy credit.”

With BNPL accounting for just 1.4% of overall retail sales i...

With BNPL accounting for just 1.4% of overall retail sales in 2025, the industry still has room to grow. But as more consumers turn to BNPL to manage their spending, the question remains: will the convenience come at a cost to financial well-being?