Nearly 10 million Brits to use BNPL schemes this Christmas

Nearly 10 million UK consumers are expected to use Buy Now, Pay Later (BNPL) schemes this Christmas, according to a new study by Marqeta.

The research conducted by the global card issuing platform reveals a significant shift in shopping habits, with just 24% of surveyed Brits planning to purchase from traditional brick-and-mortar stores this year, down from 50% in 2023. This shift corresponds with a broader trend towards online shopping and the availability of digital and flexible payment options.

The survey, which included responses from over 1,000 consumers across the United Kingdom, indicates that 51% of respondents have managed to save more money in the lead-up to Christmas 2023 thanks to the convenience of digital payment solutions. Nearly half (47%) of respondents confirmed they would rely heavily on digital wallets for their holiday purchases.

As consumers seek more strategic ways to manage their holiday spending, over a third (36%) reported intentions to use credit options such as BNPL in 2024. Notably, the proportion of consumers relying on BNPL due to a lack of traditional credit options has decreased, from 15% last year to 8% this year. Many consumers now cite better budget management (44%), convenience (43%), and flexible payment schedules (37%) as key reasons for choosing BNPL.

Despite the reliance on BNPL, 62% of respondents indicated they would proceed with purchases even if these options were unavailable, suggesting that BNPL acts more as a financial enhancer rather than a necessity.

Marcin Glogowski, SVP, Managing Director Europe and UK CEO at Marqeta, commented, "In many ways, 2024 has been a year of transformation for BNPL, evolving from an alternative payment option to a staple in everyday shopping. The substantial uptake in BNPL services this holiday season reflects a broader movement towards new, innovative payment solutions that offer greater flexibility. This is not just about spreading costs; it's about British consumers taking charge of their financial well-being and making informed choices that align with their changing economic circumstances."

The Marqeta study also revealed a burgeoning interest in multifunctional payment cards, with 44% of UK respondents expressing the desire for a payment card capable of switching between debit, credit, and BNPL modalities.

Marqeta has recently announced the development of Marqeta Flex, a BNPL solution designed to integrate seamlessly within existing payment applications and wallets, in collaboration with leading companies such as Klarna, Affirm, and the payments platform Branch. Branch aims to offer this new service to its app users, providing flexible loan options tailored to individual needs.

Marcin Glogowski added, "Marqeta has powered the growth of several of the leading BNPL solutions over the past decade, and we're looking forward to making it even easier for consumers to access BNPL options seamlessly across a wider variety of payment experiences."