Retail finance has existed as long as there have been merchants selling goods. The latest innovation, commonly referred to as buy now pay later (BNPL), has actually been offered for a couple of decades. However, the combination of the service with mobile and credit at the point of sale POS - both in-store and, more importantly, online - has spurred its rapid growth among the shopping public.

BNPL services offer to facilitate payments between merchants and their customers or suppliers via a short-term, typically interest- and fee-free installment plan. Any normal fees are typically charged to the merchant only, with the consumer charged very little or nothing for spreading the purchase payments out over a standard term. Early repayment is not penalized as the aim is to facilitate the purchase and spread payment by the consumer over multiple pay cycles.

This report analyzes the fast-growing BNPL market. It examines key players and their offerings; analyzes which trends and drivers underpin the growth of the sector; and examines the user base of BNPL firms to draw out insights regarding the market’s potential.


  • While BNPL usage is concentrated among online shoppers, a key growth area has been in-store purchases. But as in-store purchases need to be made via a POS or mobile POS terminal, the spread of these terminals is crucial.
  • The business model for BNPL does not allow for widespread defaults or lengthy credit terms in most instances. The main driver of defaults is unemployment. So long as this remains low, the prospects for BNPL services are bright.
  • Age has been a major determinant of BNPL use, and the increased prominence of millennials in the economy means BNPL use should accelerate.

Reasons To Buy

  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and business models begin to emerge.
  • Learn about the key trends these digital players are targeting.
  • Understand the BNPL value chain, and the value it brings merchants and consumers.