United States Buy Now Pay Later Business and Investment Opportunities Databook - 75+ KPIs on BNPL Market Size, End-Use Sectors, Market Share, Product Analysis, Business Model, Demographics - Q1 2025 Update

Key Insights

Continued Growth in BNPL Adoption

• This increase highlights a shift in consumer spending behavior as more shoppers seek flexible, short-term financing alternatives. The rising popularity of BNPL is particularly evident among younger consumers and those looking for alternatives to credit cards.
• The expansion of e-commerce has been a key driver of BNPL adoption, with major providers such as Affirm, Afterpay, and Klarna partnering with retailers to integrate installment payment options. Consumers are increasingly drawn to BNPL’s interest-free structure, allowing them to manage purchases without accumulating high-interest debt. As more online and in-store retailers integrate BNPL solutions, its adoption is expected to rise across various shopping categories.
• As more providers enter the market, competition will intensify, leading to expanded services, lower fees, and deeper industry integration. Additionally, BNPL’s expansion beyond retail into services such as healthcare and travel will drive wider adoption, reinforcing its role as a mainstream payment method.

Diversification of BNPL Applications

• The expansion of BNPL beyond traditional retail sectors is reshaping how consumers finance essential and high-value purchases. BNPL providers have begun offering installment payment options in industries such as healthcare and travel, allowing consumers to finance medical expenses, elective procedures, and vacation costs over time. These developments indicate that BNPL is no longer limited to retail shopping but is becoming a broader financial tool for managing major expenses.
• The demand for flexible payment solutions in high-value transactions is a key driver of this diversification. Consumers seek alternative financing options that do not involve traditional credit cards or personal loans. BNPL providers are adjusting their services to offer customized installment plans for different sectors, making expensive purchases more accessible and manageable for a wider range of consumers.
• Over the next 2-4 years, BNPL adoption will continue expanding into new industries, further embedding itself into the broader financial landscape. As BNPL becomes available for education, automotive, and professional services, its role as a mainstream financing solution will strengthen. This diversification will likely drive higher consumer spending, as installment-based payments enable greater affordability across multiple sectors.

Entry of Traditional Financial Institutions into BNPL

• Traditional financial institutions in the U.S. are expanding into the BNPL market to compete with fintech providers and retain customers seeking flexible payment options. American Express, for instance, offers "Plan It," a feature that allows cardholders to divide purchases into monthly installments with a fixed fee instead of interest. Other banks are expected to follow suit, integrating BNPL-like services within their credit card offerings or launching standalone installment payment solutions.
• The growing popularity of BNPL services has made it essential for traditional banks to adapt to stay competitive. Consumers are increasingly choosing short-term installment options over traditional credit cards, prompting banks to introduce BNPL features that align with evolving spending behaviors. By offering interest-free or low-fee installment plans, banks can appeal to a broader customer base while maintaining relevance in the rapidly changing payments industry.
• Over the next 2-4 years, the involvement of traditional banks is expected to increase consumer trust and regulatory oversight in the BNPL market. The entry of established financial institutions could lead to stricter compliance measures, ensuring responsible lending practices while giving BNPL services greater legitimacy. As banks refine their BNPL offerings, the market will likely see further innovation, expanded adoption, and greater consumer financial security.

Competitive Landscape and Regulatory Developments in United States's Buy Now, Pay Later (BNPL) Market

Current State of the BNPL Market

• The BNPL market in the U.S. has expanded significantly, fueled by increasing consumer demand for flexible payment options and the continued rise of e-commerce. As shoppers look for alternatives to credit cards, BNPL has become a mainstream payment option, particularly among younger consumers and online shoppers.
• Leading providers such as Affirm, Afterpay (owned by Block, Inc.), and Klarna have established a strong foothold by partnering with major retailers to integrate BNPL options at checkout. These companies continue to expand their offerings across multiple sectors, including travel, electronics, and fashion. As competition intensifies, new entrants and traditional financial institutions are also exploring BNPL solutions, further shaping the industry's future.

Key Players and New Entrants

• The U.S. BNPL market is dominated by key players such as Affirm, Afterpay (owned by Block, Inc.), and Klarna, each securing strong partnerships with major retailers to offer installment payment solutions. These companies have expanded their services beyond traditional retail, integrating BNPL options into the travel, healthcare, and electronics sectors. Their widespread adoption has fueled the growth of BNPL as a mainstream payment method, particularly among younger consumers who seek flexible financing options.
• New entrants and financial institutions are increasingly entering the BNPL space to compete with established players and capture a share of the growing market. Traditional banks such as American Express and Citibank have introduced BNPL-style installment plans for credit cardholders, while fintech startups and payment platforms such as Apple Pay (through Klarna) and PayPal’s "Pay in 4" continue expanding their BNPL offerings. As competition intensifies, providers focus on differentiating their services through lower fees, extended repayment periods, and seamless digital integration to attract and retain customers.

Recent Launches, Mergers, and Acquisitions

• Affirm's Financing Agreements: In January 2025, Affirm expanded its partnership with Liberty Mutual Investments, securing up to $750 million to bolster its consumer lending activities. This follows a $4 billion commitment from Sixth Street Partners in December 2024 to enhance Affirm's lending capacity over the next three years.
• Apple's Integration of BNPL Services: In October 2024, Apple incorporated Klarna's BNPL service into Apple Pay, providing users with interest-free installment options. This move came after Apple discontinued its Pay Later service, signaling a strategic shift towards partnering with established BNPL providers.

Outlook

• This rapid growth will likely drive increased competition among existing providers, leading to further innovation in BNPL offerings. Established players such as Affirm, Afterpay, and Klarna will continue to scale their services, while new entrants and traditional financial institutions will seek opportunities to capture market share.
• As BNPL adoption rises, providers are expected to diversify their offerings across industries such as travel, healthcare, and education to appeal to a broader consumer base. The market's expansion will also attract greater regulatory oversight, ensuring responsible lending and consumer protection. Over the next few years, BNPL firms must balance growth, compliance, and evolving consumer preferences to maintain a competitive edge in an increasingly crowded marketplace.

Regulatory Changes

• The Consumer Financial Protection Bureau (CFPB) introduced new regulations in May 2024, applying credit card-like protections to BNPL providers. One of the key provisions is dispute resolution, which requires BNPL lenders to investigate consumer disputes and temporarily pause payment obligations during the investigation process. This change ensures that consumers have greater protection against fraudulent or incorrect charges, bringing BNPL services in line with traditional credit card protections.
• Another critical regulatory update focuses on refund processing, mandating that BNPL providers credit refunds to consumers for returned products or canceled services. This requirement addresses a growing concern among BNPL users who previously faced challenges obtaining timely refunds, particularly when dealing with multiple parties, such as merchants and lenders. These measures aim to enhance transparency and create a more consumer-friendly BNPL ecosystem.
• The CFPB's approach to enforcement includes a transition period, during which BNPL lenders will not face penalties if they make a good faith effort to comply with the new regulations. This allows providers time to adjust their systems and policies while ensuring a smoother consumer transition. Over the coming months, the regulatory landscape for BNPL is expected to continue evolving, with further oversight likely as the industry expands and becomes a more significant part of the U.S. financial ecosystem.

Scope

United States BNPL Market Size and Spending Pattern

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later Revenue Analysis

• Buy Now Pay Later Revenues
• Buy Now Pay Later Share by Revenue Segments
• Buy Now Pay Later Revenue by Merchant Commission
• Buy Now Pay Later Revenue by Missed Payment Fee Revenue
• Buy Now Pay Later Revenue by Pay Now & Other Income

United States Buy Now Pay Later Operational KPIs & Statistics

• Buy Now Pay Later Active Consumer Base
• Buy Now Pay Later Bad Debt

United States BNPL by Purpose

• Convenience - Short Term Loans
• Credit - Long Term Loans

United States BNPL by Business Model

• Two-Party (BNPL offered by retailers)
• Three-Party BNPL Offering

United States BNPL by Merchant Ecosystem

• Open Loop System
• Closed Loop System

United States BNPL by Distribution Model Analysis

• Standalone
• Banks & Payment Service Providers
• Marketplaces

United States Buy Now Pay Later Market Share Analysis by Key Players

United States BNPL Analysis by Channel

• Online Channel
• POS Channel

United States Buy Now Pay Later in Retail Shopping: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Home Improvement: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Travel: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Media and Entertainment: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Services: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Automotive: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Healthcare and Wellness: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later in Others: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

United States Buy Now Pay Later Analysis by Consumer Attitude and Behaviour

• Sales Uplift by Product Category
• Share by Age Group
• Share by Income
• Share by Gender
• Adoption Rationale
• Monthly Expense Segments

Reasons to buy

• Insights on Strategy & Innovation: Navigate through future direction of the Buy Now Pay Later industry market by understanding strategic initiatives taken by key players to gain market share and innovation.
• In-depth Understanding of BNPL Market Dynamics in United States: Understand emerging opportunities and future direction of the BNPL market, key drivers, and trends. Benefit from a detailed market segmentation with 75+ KPIs.
• Value and Volume KPIs for Accurate Understanding: Value and volume key performance indicators (KPIs) help in developing an accurate understanding of market dynamics.
• Competitive Landscape: Get a snapshot of competitive landscape in BNPL sector with key players and market share in United States. Formulate your strategy by gaining insights into the current structure of the market.
• Develop Strategies to Gain Market Share: Create and fine tune your targeting strategy in the BNPL sector, identify growth categories and target specific segments across the value chain; evaluate important trends and risks unique to your market.
• Deeper Understanding of Consumer Behaviour: Increase ROI by understanding how consumer attitudes and behaviours are evolving. Get a detailed view on retail spending dynamics across consumer segments.