Pay later plans let people pay for their purchases over time. They are becoming a common way to shop and manage spending. A recent survey by PYMNTS Intelligence found that more than 50% of consumers think pay-later plans help them budget better.
This is why about half of the 2,655 consumers surveyed would switch to merchants that support BNPL linked to their credit cards.
Different Pay Later Options
The report “Redefining Retail-Consumer Finance Trends Driving the Evolution of Pay Later Plans,” created in partnership with Splitit, looks at how people feel about different pay later options.
These include buy now, pay later (BNPL) plans, installment plans that are inked with a card for general purposes, and plans linked to store credit cards.
Generational Preferences in Pay Later Plans
Exclusive data from PYMNTS Intelligence, not included in the final report, shows that the use of pay-later plans varies by generation. For example, 27% of baby boomers and seniors, 34% of Generation X shoppers, and 40% of millennials use these plans mainly to buy clothes and accessories.
On the other hand, more than 50% of Generation Z consumers use them primarily for groceries. When it comes to the second most popular use, almost half of Gen Z consumers use BNPL to purchase clothing items and accessories. Meanwhile, shoppers from other generations use these plans to pay for food.
Generational Spending Patterns
People such as baby boomers, and Gen Xers use BNPL for big items like appliances. Bridge millennials use them for home furnishings, which makes sense because many of them own homes.
Millennials and Gen Z shoppers, on the other hand, use these plans for extra purchases, showing they have more flexible spending habits.
Changing Spending Trends
People of all ages are now using pay-later plans for cheaper, everyday items. This matches the survey results that show these plans help people budget better. These plans are especially convenient for Gen Z as they fit well with their lifestyle and choices.
Merchants should offer pay-later plans for lower-priced items. This matches how people are currently using these plans and could help attract more customers. In previous days, most of the people are unaware of these facilities and options.
But now, things have been completely evolved. Most importantly, people are preferring their comfort and convenience over everything.