November 20, 2020 | 5 min read

10 surprising characteristics of Buy Now, Pay Later users

Buy Now, Pay Later is the “it” payment method for the 2020 holiday season. Three out of five consumers recently surveyed by Propeller Insights for Marqeta’s 2020 State of Payments Report said that they would use Buy Now, Pay Later (BNPL) for all their holiday shopping if they could.

Having emerged around eight years ago as a payment method associated primarily with cash-strapped millennials and student loan-burdened Gen Zers, today Buy Now, Pay Later caters to a breed of consumers that share some surprising characteristics, according to our survey results. 

1. BNPL is most popular with males in high-income households and females in households that earned significantly below the median. Ninety-two percent of males who reported a combined family income of greater than $200,000 said they had used Buy Now, Pay Later; 62% of females who reported a combined family income of less than $50,000 said they had used Buy Now, Pay Later.

Buy Now, Pay Later users by gender and household income

2. Older Gen X adults seem to be adopting BNPL rapidly. Respondents aged 35 to 50 were significantly more likely to say they had used a Buy Now, Pay Later service. Sixty-two percent of this age group had tried Buy Now, Pay Later, compared to just 40% of people aged 16 to 34, 32% of people aged 18 to 25, and 15.5% of people aged 51 to 64.

3. BNPL users tend to be married. Sixty-three percent of people who said they had used BNPL services were married versus 45% who had not used BNPL. (Nationwide, 48% of American adults are married.)

4. BNPL users were more likely to have children. Seventy-four percent of people who tried BNPL had children compared to 49% of people who had not tried BNPL.

Nearly 3 out of 4 of BNPL users have children

5. Buy Now, Pay Later users were more likely to be employed full time. Seventy-three percent of BNPL users described themselves as employed full time compared to just 46% of non-BNPL users.

6. BNPL users were more likely to have an advanced degree. Twenty percent of BNPL users had a Ph.D., a medical or law degree, or some other advanced degree. In comparison, only 12% of non-BNPL users had reached that level of education. On the other hand, non-BNPL users had an edge over BNPL users when it came to having an associate degree, bachelor’s degree, or completing some college. Fifty-seven percent of non-BNPL users fell into this category versus 52% of BNPL users.

7. BNPL users were more likely to have tried a peer-to-peer payment service like PayPal, Cash App, Venmo, or Zelle. Eighty-eight percent of BNPL users said they had used a peer-to-peer service compared to 77% of all survey respondents. Cash App was most popular with BNPL users (42%), followed by PayPal (28%), then Venmo (23%).

Nearly 9 out of 10 Buy Now, Pay Later users have tried a peer-to-peer payment service

8. BNPL users were more likely to describe themselves as heavy users of on-demand delivery services. Seventy-two percent said they ordered from an on-demand delivery service at least once a week, compared to 53% of non-BNPL users.

9. BNPL users are planning to spend more during the holidays than non-BNPL users. Forty-two percent of BNPL users said they would be budgeting more money for the holidays, and 13% said they would be budgeting less. In comparison, just 8% of non-BNPL users said they would have bigger budgets, and 36% said their budgets would be smaller.

2 out 5 BNPL users said they plan to spend more on the holidays this year

10. BNPL users are more likely to think about changing banks. Fifty-nine percent said they were considering using another bank, compared to just 32% of non-BNPL users.

The above characteristics together paint an interesting picture of BNPL user as a middle-aged, mid-career, digitally savvy individual who leverages emerging business avenues to enhance his/her lifestyle. With years of strong purchasing power ahead of them, this population might well define the evolution of credit and banking over the next couple of decades.

Read more in our Buy Now, Pay Later series:

How Buy Now, Pay later became this this generation’s layaway

Buy Now, Pay Later vs. installment loans

Bank of America’s move into no-interest installment loans

Why financial institutions want their share of Buy Now, Pay Later transactions

Photo courtesy of Nathan Lemon and Unsplash

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