December 7, 2023
Buy Now Pay Later Platforms Market

Buy Now Pay Later Platforms Market Is Estimated To Witness High Growth Owing to Rising E-commerce Penetration

The Buy Now Pay Later Platforms Market is estimated to be valued at US$10.42 Bn in 2022 and is expected to exhibit a CAGR of 21.5% over the forecast period 2022 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
Buy Now Pay Later (BNPL) platforms offers an alternative mode of payment for goods and services bought online or in-store. It allows consumers to pay for products in installments, usually spread over four equal payments without interest. This payment option has gained immense popularity as it enables consumers to manage their budget better while avoiding interest charges unlike credit cards. Major merchants like Amazon, Target, Walmart have integrated BNPL platforms at checkouts to boost sales.

Market Dynamics:
One of the major drivers fueling the growth of BNPL platforms market is the rising penetration of e-commerce industry globally. According to a report, cross-border e-commerce sales are expected to reach $712 billion by 2026, registering growth of 57%. As e-commerce sales continue to increase dramatically, more merchants are leveraging BNPL platforms to boost average basket sizes and drive higher repurchasing. Another driver is the growing millennial population which prefers flexible payment options over credit cards. Millennials represented 27% of total e-commerce sales in 2020 in the US. As millennials enter their prime earning and spending years, their BNPL adoption is set to surge significantly.
Segment Analysis

The global Buy Now Pay Later (BNPL) Platforms market is dominated by split payment sub-segment. The split payment sub-segment allows customers to split their purchase into installments which are more affordable and flexible than traditional credit options. It dominates as it provides greater financial flexibility to customers and increases checkout conversation rates for merchants.

PEST Analysis

Political: Regulations around BNPL are evolving with some jurisdictions restricting marketing practices for deferred interest instalment loans.

Economic: The post-COVID economic recovery and rising inflation has increased the adoption of BNPL as it allows consumers to afford items earlier than saving up fully.

Social: BNPL platforms are socially acceptable as the payment option provides flexibility to consumers and allows them to budget cashflow effectively over time for discretionary purchases.

Technological: Adoption of mobile technology and emphasis on checkout experience is driving integration of BNPL within e-commerce platforms and payment options. Partnerships between BNPL providers and merchants are increasing.

Key Takeaways

The global Buy Now Pay Later Platforms Market Trend is expected to witness high growth, exhibiting CAGR of 21.5% over the forecast period, due to increasing financial inclusion driven by evolving payment preferences of millennials and gen Z. The United States region currently dominates the BNPL platforms market share owing to strong consumer spending culture and financial technology adoption rates.

Regional analysis: The BNPL platforms market is growing fastest in the United States region. The region currently dominates with over 30% market share led by high financially literate population and partnerships between BNPL providers and large retailers.

Key players: Key players operating in the BNPL Platforms market are Afterpay, Zippay, VISA, Sezzle, Affirm, Paypal, Splitit, Latitude Financial Services, Klarna, Humm, and Openpay. Afterpay and Klarna are the prominent players dominating the deferred payment segment globally.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it