Nearly 75% of Brits embrace buy now, pay later services

A recent study by Secure Data Recovery reveals that nearly three-quarters of Britons have used buy now, pay later (BNPL) services, which have become increasingly popular since their introduction in 2014.

The research indicates a significant portion of the UK population is embracing BNPL services, with everyday clothing topping the list of items purchased through this method. Following clothing, furniture and shoes also rank among the most common items bought using BNPL.

Tech gadgets, another popular category, constitute over half of the top ten items purchased with BNPL. Home electronics and appliances are among the other frequently bought items, with laptops and tablets taking the fifth position, and smartphones and game consoles securing the seventh and eighth spots, respectively.

Timothy Burlee of Secure Data Recovery commented on the trend, stating, "It's clear technology purchases are a large buy now, pay later contributor in the UK. Tech purchases can be more pricey, so Britons are utilizing the services to cover the higher prices over an extended period." This usage pattern corresponds with the rising prices of tech items, alongside the practicality of spreading the costs over time.

Various BNPL platforms have established themselves in the UK over the past decade. Klarna, PayPal Pay in 3, Clearpay, Zilch, and Laybuy are among the notable services that allow consumers to spread their payments. Klarna slightly leads with 59.9% of surveyed Britons using it, closely followed by PayPal Pay in 3 at 58.7% usage.

The study highlighted generational differences, with Gen Z showing a particular preference for mobile app transactions. Nearly three-quarters of Britons view BNPL services as a favourable alternative to credit cards, citing average credit card APRs of over 35% as a contributing factor. Klarna offers interest rates ranging from 0% to 28% based on the repayment plan, appealing to consumers looking for flexibility in payment options. As a result, 98% of BNPL users expressed confidence in making payments, although over 20% admitted to missing at least one payment.

There are noticeable trends in BNPL usage across genders, with women predominantly using these services for purchasing everyday clothing, while men primarily focus on home electronics. Regional preferences also emerge, as everyday clothing is most frequently purchased with BNPL services in Scotland, home electronics in Northern Ireland, smartphones, laptops, and tablets in England, and gaming consoles and accessories in Wales.

The growing traction of BNPL services has sparked discussions around regulatory measures. Nearly 80% of Britons believe that government oversight could enhance consumer protection. Despite such concerns, the widespread use of BNPL hints that consumer habits are unlikely to change soon, with nearly 66% of Britons expressing willingness to spend more when BNPL options are available.