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Continued concern for the economy may cause consumers to rely more heavily on credit cards and buy now, pay later (BNPL) services in the future. Credit card debt in the US totaled $1.12 trillion in Q1 2024, up 13.1% YoY, per the Federal Reserve Bank of New York. Use this chart:. Adjust credit card marketing strategies to boost new credit card openings. Illustrate growth potential for BNPL services.

Spotlight on the Affirm Card: The buy now, pay later (BNPL) company鈥檚 debit product helped propel growth. The Affirm Card volume hit $397 million in Q2, up from just $11 million a year ago. And 30% of card volume was in store. The card also boasted 700,000 active consumers at the end of Q2, compared with just 50,000 last year.

And niche BNPL newcomers are also trying to sweep up market share as BNPL grows: The number of US BNPL users is expected to hit 79 million in 2022, up from 50.6 million last year, per Insider Intelligence forecasts. Consumers now have a much wider array of BNPL options to choose from than they did before the pandemic鈥攎aking it harder for incumbents to stand out.

Like many other buy now, pay later (BNPL) providers, ecommerce makes up the bulk of Affirm鈥檚 retail business. Levchin also said Affirm began to see signs of inflation-related stress from 鈥渃ertain low-credit-segment consumers鈥� in Q2. But he added that the firm鈥檚 underwriting process鈥攚hich involves using credit reports, credit scores, and key shopping information鈥攈elped it avoid high charge-off levels.

Issuers must provide payment flexibility to compete against buy now, pay later (BNPL) and shifting consumer expectations. US BNPL payment value will see a compound annual growth rate (CAGR) of 14.8% from 2023 to 2027, when it will reach $124.82 billion, per our forecast. This pales in comparison to the $3.466 trillion in credit card spending at food service and retail in 2023.

Deep discounting, mcommerce remain keys to holiday season success. 5 key stats on holiday retail: Shoppers start early, spend on mobile, and rely on buy now, pay later. Retailers stocked up for the holidays earlier than usual this year, which could lead to challenges ahead.

Related content: Check out our US Buy Now, Pay Later Forecast 2022 to learn about the factors that will affect growth in the space this year. This article originally appeared in Insider Intelligence's Payments Innovation Briefing鈥攁 daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily. Are you a client?

So Buy Now, Pay Later accounted for 7.6% of online orders, which is up 16.4% year over year. And that really stuck out at me. Buy Now, Pay Later use has been soaring over the past few years. Last year it was 6.4% of all orders, and consumers are continuing to spend, but they're increasingly turning to credit and credit alternative options such as Buy Now, Pay Later. And it's interesting.

Note: Examples of websites or apps primarily engaged in financial services include those of banks (e.g., Chase, Wells Fargo), fintechs (e.g., buy now, pay later services, insurtechs), and payment providers (e.g., Block, PayPal).

Buy now, pay later is a great example. The younger generations tend to gravitate towards those types of products, and they might have more than one buy now, pay later, but at a certain point it may make sense for them to do consolidation.

The news: Buy now, pay later (BNPL) provider Affirm鈥檚 Adaptive Checkout will now be available to all Worldpay from FIS merchants, per a press release. Worldpay merchants will be able to offer consumers biweekly and monthly payment options. Affirm鈥檚 financial state: Affirm has had trouble keeping up with the rapid growth from fiscal 2022.

The same thing happens with buy now, pay later or pay in four, where you won't necessarily be offered it on the item page, but you'll be offered it at checkout. And that might be the wrong time to target me with that, because likely, if I've made it that far, I'm willing to buy that item for the price that I've been quoted.

Most healthcare AI startups want to sell their solutions to health systems: But these tech companies struggle to demonstrate their value prop to potential healthcare provider buyers.

Consider offering BNPL solutions. Almost half of credit unions say BNPL is not in their near-term plans, per January 2024 data from PYMNTS Intelligence. But as demand grows, it鈥檚 worth evaluating the option. FIs can evaluate either developing BNPL capabilities internally or working with a third-party intermediary to offer them to customers.

In 2022, affiliate marketers鈥� interest started to rise in BNPL providers such as Klarna. In 2023, that interest is spiking, thanks in part to US consumers鈥� continued embrace of the technology: Nearly three in 10 US adults will use a BNPL service in 2023, up from less than 1% five years ago.

Amazon鈥檚 opportunity: Bringing BNPL into the fold could ensure that Amazon doesn鈥檛 lose sales as the payment method gets more popular in Canada. By accepting BNPL鈥攔ather than avoiding third-party tie-ups, as it鈥檚 historically done鈥擜mazon is ensuring that customers who want to use BNPL don鈥檛 leave for a rival retailer like Walmart, which developed a BNPL solution for its co-brand users in Canada.

What this means: Affirm is giving up a major BNPL market鈥攂ut it鈥檒l also minimize costs and improve profitability. Australia had about 7 million BNPL customer accounts as of June 2022, according to the Reserve Bank of Australia. And BNPL payment value had reached $16 billion, about 2% of card purchases that year鈥攎aking it an attractive market for providers.

And 12% anticipate doing so in the coming 12 months. 8% of US adults have also used buy now, pay later (BNPL) to pay for necessities. A similar share anticipated using BNPL for necessities in the next year. BNPL use overall was higher among parents: 37% used BNPL in the past month.

In the US, PayPal is building out its service suite to include buy now, pay later; crypto; and small-business features, among others. That creates more use cases for the wallet, helping it become a go-to app for a consumer鈥檚 financial services needs鈥攊ncluding P2P.

Expanded BNPL. Affirm and Zip鈥檚 buy now, pay later (BNPL) options will be available at more merchant sites and Android apps across the US following a December pilot. Consumers can link their BNPL accounts to Google Pay or sign up with either provider within Google Pay鈥檚 checkout. How it can help: Not offering a customer鈥檚 preferred payment method at checkout can hurt conversion rates.

Its latest include buy now, pay later and savings account options, giving consumers more reasons to engage with the tech giant鈥攁nd use P2P along the way. They can tap generational tailwinds by targeting younger consumers.

Dramatic shifts are in the works for 2024, as BaaS, social media players, genAI, and new digital wallets reshape the banking landscape. Our top trends explore what鈥檚 in store.