Home Business News Boomers lead BNPL growth as two in five plan to use service in coming year

Boomers lead BNPL growth as two in five plan to use service in coming year

by Thea Coates Finance Reporter
5th Apr 24 9:47 am

TransUnion, a global information and insights company, has released results from its Q1 Consumer Pulse survey revealing sustained demand for Buy Now, Pay Later services (BNPL).

BNPL services allow consumers to split purchases into manageable instalments, often interest-free. Nearly a quarter of adults (23%) said they have used the service in the past year, mirroring pre-festive season observations.

The survey data points towards a robust and maturing sector, with more than one in five (21%) planning to apply for new BNPL services in the coming year. Yet despite many associating BNPL with younger generations, Baby Boomers[i] seem likely to lead the way for future BNPL growth. In Q1 2024, nearly two in five (38%) plan to use these services in the next 12 months. The highest among any generation surveyed and 21 percentage points higher than in Q4 2023.

Despite this growth in older demographics, use amongst Millennials and Gen Z is strong, with a third (33%) of Millennials saying they have used BNPL services in the past 12 months – the same as Q1 2023. Reported Gen Z usage increased annually, with 34% saying they made a purchase in the past 12 months using BNPL services, compared with 28% at the same time last year.

Kelli Fielding, chief product officer at TransUnion in the UK, said, “With BNPL data now incorporated into credit reports, consumers have a clearer view of their overall financial picture. This can help protect shoppers and support financial inclusion and wider access to credit. Additionally, it can help finance providers to have a holistic view of an individual’s borrowing, so they can use these insights to enable the right outcomes.”

Across generations, clothing and accessories was the top stated product bought in the UK using BNPL services, with Gen Z and Millennials leading the way both at 45% among those who said they used BNPL in the past 12 months. Interestingly, a notable demographic difference is seen when using BNPL to purchase food, with 30% of Gen Z and 25% of Millennials saying they did so, in contrast to only 14% of Gen X and a much smaller 3% of Baby Boomers. Across generations, respondents said they were most likely to have spent between £250 and £499 in the last 12 months to make BNPL purchases.

There are generational differences in why people opt not to use BNPL services. Avoiding debt continues to be the leading factor as to why Gen Z (39%), Millennials (38%) and Gen X (39%) said they don’t use BNPL, whereas 57% of Baby Boomers stated there is no need for them to use it.

However, the majority of all respondents agree that spreading payments over time is their main reasons for using BNPL products – this applied to half of Gen Z (52%), nearly two thirds of Millennials (64%), 69% of Gen X and 71% of Baby Boomers.

Kelli Fielding continues: “The latest Consumer Pulse survey highlights the importance of responsible borrowing across all age groups. Understanding terms and conditions, including potential fees and repayment structures, remains crucial for informed financial management. This focus on responsible use – supported by the latest information being available to lenders – will ensure the long-term success of the BNPL sector.”

Leave a Comment

You may also like


Sign up to our daily news alerts

[ms-form id=1]