North America Buy Now Pay Later (BNPL) Market by Channel (Online and Point of Sale (PoS)), by Application (Retail Goods, Media & Entertainment, Healthcare & Wellness, Automotive, Home Improvement, and Others), by End User (Generation X, Generation Z/Millennials, and Baby Boomers) - Opportunity Analysis and Industry Forecast, 2024– 2030
Industry: ICT & Media | Publish Date: 31-May-2024 | No of Pages: 123 | No. of Tables: 84 | No. of Figures: 49 | Format: PDF | Report Code : N/A
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North America Buy Now Pay Later (BNPL) Market Overview
The North America Buy Now Pay Later (BNPL) Market size was valued at USD 53.11 billion in 2023, and is predicted to reach USD 274.15 billion by 2030, at a CAGR of 22.3% from 2024 to 2030. Buy now pay later (BNPL) is a convenient short-term financing option that allows consumers to defer payment for purchases to a later date. This payment method, structured with an installment plan, involves consumers, financiers, and merchants, enabling customers to shop online and in stores without immediate full payment. BNPL is versatile, covering a wide range of purchases from everyday items including clothing and electronics to larger expenses such as home improvement products.
The popularity of BNPL is on the rise due to its numerous advantages for consumers. It provides a flexible way to buy high-cost items such as smartphones and laptops, pay for educational expenses including tuition fees and stationery, and even cover daily expenses such as canteen bills. Additionally, the introduction of zero-interest payment options by BNPL providers makes this payment solution even more appealing to customers, offering them a convenient and attractive payment alternative.
Rising E-Commerce Platforms with Online Payment Methods Thrives the North America Buy Now Pay Later (BNPL) Market Growth
The rise of e-commerce shopping creates a pivotal role in driving the growth of the Buy Now Pay Later (BNPL) market. As online shopping continues to gain traction among consumers for its convenience and variety, BNPL services have seamlessly integrated into e-commerce platforms, offering shoppers the option to pay for purchases in installments. This integration not only increases conversion rates for online retailers but also leads to higher average order values as consumers feel empowered to make larger purchases without the immediate financial burden.
Moreover, by providing BNPL options, e-commerce retailers gain a competitive advantage, attracting and retaining customers who seek the convenience and financial flexibility of flexible payment solutions. The alignment between BNPL services and the preferences of online shoppers underscores the symbiotic relationship between the rise of e-commerce and the expansion of the BNPL market, making it a significant player in the evolving landscape of digital payments.
Increasing Online Shopping Among the Consumers is Driving the Growth of the North America Buy Now Pay Later (BNPL) Market
The buy now pay later (BNPL) market is propelled by the increasing prevalence of online shopping. With digital commerce progressively shaping consumer habits, individuals are embracing the convenience of purchasing goods and services online. This surge in online transactions has fueled a rising demand for flexible payment solutions that accommodate various financial needs. BNPL services have emerged as a frontrunner in addressing this demand, providing consumers with the flexibility to postpone payments or spread costs over manageable installments.
This adaptability appeals to a diverse range of shoppers, from those seeking prudent financial management strategies to individuals desiring immediate access to desired products without the burden of upfront payments. The symbiotic relationship between online shopping and BNPL services highlights a transformative shift in consumer behaviour and payment preferences, signaling ongoing growth and innovation in the BNPL market.
High Interest Rates and Fees Associated with BNPL services Hinder the North America Buy Now Pay Later (BNPL) Market Growth
In the buy now, pay later (BNPL) market, high fees and interest rates may impede its growth by discouraging consumer utilization. BNPL transactions often involve installment payments with added fees or interest charges. If these fees are perceived as excessively high, consumers may opt for alternative payment methods or choose to avoid accumulating further debt.
This reluctance to use BNPL options may limit market expansion and undermine consumer trust. To overcome this challenge, BNPL providers must carefully manage their fee structures and interest rates to ensure affordability while maintaining competitiveness. Transparent pricing, clear communication of terms, and responsible lending practices are vital for building trust and encouraging widespread adoption of BNPL services. Regulatory oversight may also play a crucial role in ensuring fair and transparent pricing practices within the BNPL market.
Integration of Artificial Intelligence (AI) Technology Creates Ample Opportunity Growth for the North America Buy Now Pay Later (BNPL) Market
Incorporating AI algorithms into credit assessment for the buy now pay later (BNPL) industry denotes a modern strategy for evaluating consumer creditworthiness. By analyzing diverse data sources, including unconventional indicators such as online shopping habits and social media activity, alongside traditional credit history, AI-driven algorithms enable a comprehensive evaluation of individual financial behaviours.
This holistic approach facilitates more accurate credit assessments and tailored financing options for customers. Moreover, the continuous learning capabilities of Artificial Intelligence (AI) algorithms ensure that credit scoring models remain adaptive to evolving consumer trends over time. Therefore, the incorporation of AI into credit assessment processes within the BNPL industry enhances risk management capabilities and contributes to a more personalized and efficient customer experience.
The U.S. Holds the Dominant Market Share in North America Buy Now Pay Later Market
The adoption of buy now pay later (BNPL) services by merchants is a crucial factor driving the growth of the BNPL market. This trend entails integrating BNPL payment options into the offerings of an increasing number of retailers and e-commerce platforms. For consumers, this translates to greater payment flexibility, allowing them to spread the cost of purchases over installments rather than paying the full amount upfront. Such flexibility appeals to shoppers, especially for larger-ticket items, making purchases more manageable within their budgets.
Meanwhile, for businesses, offering BNPL options can lead to boosted sales and conversion rates. By providing alternative payment methods, merchants can attract a broader customer base and reduce shopping cart abandonment rates. The integration of BNPL services into various retail channels helps merchants stay competitive, catering to the preferences of consumers, particularly younger demographics who favor the convenience and flexibility of BNPL solutions. As more merchants embrace BNPL options, the market is poised for further expansion and innovation, driving continued growth in the BNPL sector.
The burgeoning Buy Now Pay Later (BNPL) sector experiences a notable surge, largely driven by the preferences of Millennials and Generation Z. These younger demographics demonstrate a marked inclination toward BNPL solutions owing to their inherent appreciation for financial flexibility and aversion to conventional credit card paradigms. Faced with financial constraints such as student debt and soaring living expenses, the appeal of spreading payments over time sans interest accrual holds considerable sway.
Furthermore, their adeptness with technology and habitual online shopping tendencies seamlessly align with the integration of BNPL facilities into digital commerce platforms. Through the provision of transparent, interest-free installment schemes, BNPL services resonate with the core values of these cohorts, emphasizing prudent expenditure and digital convenience. Consequently, BNPL providers adept at catering to the preferences of Millennials and Gen Z are primed to seize a substantial market share.
Mexico to Witness Substantial Growth in the North America Buy Now Pay Later Market
The growth trajectory of the Buy Now Pay Later (BNPL) market has been significantly influenced by the ascent of e-commerce. With consumers increasingly favouring online shopping due to its convenience and extensive product offerings, BNPL services have seamlessly integrated into e-commerce platforms, enabling customers to split their payments into manageable installments. This integration not only boosts conversion rates for online retailers but also drives up the average order value, as consumers are emboldened to make larger purchases without immediate financial strain.
Furthermore, by incorporating BNPL options, e-commerce merchants gain a competitive edge, attracting and retaining customers who value the convenience and financial flexibility afforded by such payment solutions. The alignment between BNPL services and the preferences of online shoppers underscores the mutually beneficial relationship between the proliferation of e-commerce and the expansion of the BNPL market, solidifying its significance in the evolving digital payments landscape.
The expansion of the Buy Now Pay Later (BNPL) market is significantly driven by its unmatched convenience for consumers. In contrast to traditional payment methods requiring upfront full payment, BNPL services empower shoppers to split their purchases into smaller, manageable installments over time. This flexibility is especially appealing to individuals facing temporary financial constraints or those seeking to spread out their expenses.
With streamlined application processes and instant approval decisions, BNPL offers a straightforward alternative to conventional financing options such as credit cards or personal loans. By aligning with modern consumer preferences for simplicity and flexibility in managing finances, BNPL has emerged as a crucial player in the evolving landscape of payment solutions, fostering its widespread adoption and growth.
Competitive Landscape
The market players operating in the North America buy now pay later industry include Affirm Holdings, Inc., Atome, Block, Inc. (Square), Klarna Bank AB (PULP), Latitude, Openpay, PayPal Holdings, Inc., Sezzle, Scalapay, Zip Co Ltd. (Zip), and others.
North America Buy Now Pay Later Market Key Segments
By Channel
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Online
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Point of Sale (PoS)
By Application
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Retail Goods
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Media & Entertainment
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Healthcare & Wellness
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Automotive
-
Home Improvement
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Others
By End User
-
Generation X
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Generation Z/Millennials
-
Baby Boomers
By Country
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The U.S.
-
North America
-
Mexico
REPORT SCOPE AND SEGMENTATION:
|
Parameters |
Details |
|
Market Size in 2023 |
USD 53.11 Billion |
|
Revenue Forecast in 2030 |
USD 274.15 Billion |
|
Growth Rate |
CAGR of 22.3% from 2024 to 2030 |
|
Analysis Period |
2023–2030 |
|
Base Year Considered |
2023 |
|
Forecast Period |
2024–2030 |
|
Market Size Estimation |
Billion (USD) |
|
Growth Factors |
|
|
Countries Covered |
3 |
|
Companies Profiled |
10 |
|
Market Share |
Available for 10 companies |
|
Customization Scope |
Free customization (equivalent up to 80 working hours of analysts) after purchase. Addition or alteration to country, regional, and segment scope. |
|
Pricing and Purchase Options |
Avail customized purchase options to meet your exact research needs. |
KEY PLAYERS
-
Affirm Holdings, Inc.
-
Atome
-
Block, Inc. (Square)
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Klarna Bank AB (PULP)
-
Latitude
-
Openpay
-
PayPal Holdings, Inc.
-
Sezzle
-
Scalapay
-
Zip Co Ltd. (Zip)
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