BNPL or “Buy Now Pay Later” payment solutions have grown at substantial rates in the last few years stated Bahaa Abdul Hussein. They’re expected to increase from 10% in 2021 to 25% of entire global online shopping transactions in 2025. Moreover, the millennial and Gen Z consumers who are tech-savvy love all the novel digital payment methods including BNPL. Nearly 75 per cent of the American population uses PayPal, and popular tech giants like Amazon and Apple also offer Pay Later installment schemes now. We take a look at how BNPL is expected to grow in the next decade and what factors will drive its promising future.

Gen Z audience

Today’s generation is all about consuming what they desire immediately without letting the lack of finances stop them. BNPL payments are already a hit with today’s youth and this is only projected to rise in the upcoming years. More BNPL companies are specifically targeting this audience and understanding their tastes and preferences to offer better services.

Macroeconomic fluctuations

Since the pandemic, major economic changes around the world have been influencing online shopping trends. With countries tackling recession and wars impacting global trade, these socioeconomic factors will also have an impact on the common man. BNPL is taking off particularly because many users feel the pinch in their pockets, unable to make full payments.

Embedded finance

Banks are realizing they need to keep up with BNPL and offer innovative solutions to compete with the BNPL providers. For instance, Virgin Money and NatWest have implemented BNPL plans targeting their younger audiences. We can expect to see big entrants into the international BNPL arena in the coming years.

SNPL

Considered to be an off-shoot of BNPL schemes, SNPL or “Save Now Pay Later” plans are also becoming popular. Working like a rewards accumulation system, they are encouraging users to save their money for future purchases with various schemes that save from their income, automatic savings and so on. This is pioneered by the likes of Sav Money, a U.A.E.-based BNPL company.

Policies and competitors

Since BNPL is a relatively new field, its growth will be studied in order for governments around the world to device policies and regulations surrounding it. More competition may also be seen, as Western BNPL merchants plant roots in Asia and go global. The sphere of BNPL promises exciting things for those who are eager to use it. Stick around and you’ll surely find something that helps your online shopping experience easier, safer and speedier than ever!

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