Buy Now, Pay Later (BNPL) has surged in popularity, particularly among Gen Z and millennials, as consumers increasingly turn to online shopping. This payment method allows users to make purchases and pay for them in installments, typically over one to six months, often without fees. Data from Javelin Strategy & Research indicates that one-quarter of consumers utilized BNPL in 2023, with notable success among younger demographics. Research published in the Journal of Marketing highlights BNPL's positive impact on consumer spending, revealing a 9% increase in purchase likelihood and a 10% rise in average order sizes among BNPL users compared to non-users. This spending boost persisted for up to six months, challenging the notion that BNPL is a fleeting trend. Additionally, BNPL provides psychological benefits, as it allows consumers to feel a sense of control over their finances while minimizing the perceived cost of purchases, similar to the effects of credit cards.
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