Global Buy Now Pay Later (BNPL) Market Size Reports
According to the recent market study done by the CMI Team, the Global Buy Now Pay Later Market across the globe is likely to achieve a CAGR of 27% between 2023 and 2032. During 2022, the size of the market is likely to reach a valuation of USD 6.1 Billion. During 2032, the valuation is likely to reach USD 25.7 Billion.
Global Buy Now Pay Later (BNPL) Market is a payment service that allows consumers to make advance purchases of products and postpone payment at a future time. This process involves several elements and operations, such as payment platforms, retail relationships, application processes, credit checks, structured repayment schedules, and possible interest rates.
BNPL is routinely utilized for every kind of purchase, ranging from consumer electronics to apparel, household items, automobiles, healthcare treatment, holidays, travel tickets, hotels, and e-commerce shopping. The benefit of this service is immense in the form of improved financial agility, increased convenience, lower money pressure, and consumers’ facilitation to obtain premium and high-end products.
The Global Buy Now Pay Later (BNPL) Market is growing very strongly with its adoption across many industries. In the retail e-commerce industry, BNPL services are being used comprehensively to lure customers, enhance conversion rates, and minimize shopping cart abandonment, thus driving market growth.
Further, the education sector has welcomed BNPL services, allowing one to take up wanted courses and degrees without having to pay full fees directly, thus adding to market growth. In the auto sector, the use of Global Buy Now Pay Later (BNPL) Market is increasing, enabling vehicle acquisition by spreading the expenditure over a specified time, which is propelling market growth.
Furthermore, growing consumer interest in accessing subscription-based companies such as media streaming services, fitness applications, and beauty subscription boxes is supporting market growth. A number of factors are significantly contributing to market growth, such as changing consumer buying habits, an increased emphasis on improving user experiences, and the rising number of collaborations between BNPL service providers and industry players. These factors collectively support the overall growth and expansion of the BNPL market.
Global Buy Now Pay Later (BNPL) Market – Key Growth Drivers
Convenience of the Consumer:
BNPL services provide consumers with the convenience of purchasing right away and paying later. The flexibility in payment terms is appealing to consumers and makes them shop more frequently.
Lower Cart Abandonment: In online shopping, BNPL offerings have been found to lower cart abandonment rates. Consumers are more inclined to make the purchase when offered the ability to pay later, particularly for expensive products.
Accessibility and Inclusivity: BNPL services tend to have softer credit criteria than conventional credit cards, and therefore, are more accessible to a wider base of consumers, including those with little or no credit history.
Interest-Free Periods: A lot of BNPL providers allow interest-free payment periods, luring customers into not paying any interest charges for their purchases.
Retail Partnerships: BNPL providers form agreements with numerous retail companies, online and offline, increasing their base and providing more chances for customers to use BNPL services.
Education Sector Use: The use of BNPL services in the education sector enables students to access courses and diplomas without immediately having to pay full tuition costs.
Automotive Industry Use: In the auto industry, BNPL services are utilized to cover vehicle purchases so that consumers can stagger the expense over a certain duration.
Subscription-Based Services: BNPL is used more by consumers for subscription-based businesses like media streaming services, fitness apps, and beauty subscription boxes, giving them greater access to these products.
Changing Consumer Behavior: Changing shopping behavior, such as a shift to online shopping and a desire to have flexible payment terms, is driving the consumption of BNPL services.
Global Buy Now Pay Later (BNPL) Market – Mergers and Acquisitions
Square’s Purchase of Afterpay: Square, a fintech firm, announced in August 2021 its purchase of Afterpay, a top BNPL provider worldwide. The merger enabled Square to enhance its payment and financial services capabilities while giving Afterpay access to more customers and greater capabilities.
PayPal’s Purchase of Paidy: PayPal purchased Japanese BNPL company Paidy in October 2021. This purchase was made to expand PayPal’s foothold in the Japanese market and BNPL offerings internationally.
Klarna’s Purchase of Hero: Klarna, a leading BNPL player, purchased retail tech firm Hero in September 2021. This purchase was intended to make shopping in stores better by merging BNPL solutions with physical stores.
Affirm’s Purchase of Returnly: In May 2021, Affirm, yet another large BNPL market player, bought Returnly, a return and exchange solution specialist. The purchase allowed Affirm to provide customers with a smooth returns experience.
Category-Wise Insights
By Channel:
Online platforms have become the preeminent power in the Global Buy Now Pay Later (BNPL) Market sector, driven mainly by the spectacular growth of the e-commerce sector. Online platforms provide a harmoniously integrated shopping experience, enabling consumers to browse through a wide range of products while easily accessing BNPL payment options at the checkout stage.
The combination of BNPL services and online shopping websites is further augmented by the rising number of partnerships and collaborations, with the purpose of simplifying the payment process and making it more convenient for users.
Additionally, online platforms do away with the requirement of manual paperwork or physical interactions, allowing customers to make the entire purchase process in a quick manner. This not only saves time but also improves the overall shopping experience greatly.
Moreover, the wide ranges of products spanning different industries provided on online marketplaces enable consumers to utilize BNPL services to finance purchases through a broad selection of categories.
Essentially, the supremacy of online channels within the BNPL space mirrors their central position to define the direction of consumer finance in the future, providing ease, variety, and accessibility to a large population of consumers.
By Enterprise Size:
Established large businesses have a clear edge in the Global Buy Now Pay Later (BNPL) Market sector, based on their established brand names and strong market presence. These aspects create a feeling of security and trust among consumers when using BNPL services.
In addition, the huge financial resources available to them enable large businesses to expand their operations and sustain a competitive advantage in the ever-changing BNPL market environment.
In addition, large companies’ huge investments in cutting-edge payment platforms, advanced data analytics, highly advanced risk assessment tools, and secure customer management systems help to provide a seamless and intuitive experience.