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This is one digital card product that lets consumers pay with debit; credit; buy now, pay later (BNPL); or rewards. Cardholders have to have an open line of credit with the bank issuing their digital card to use the credit function. Participating banks will issue the digital cards and let consumers pick their payment preferences in their mobile banking app.

That may mean PayPal pivots to focus on areas where it鈥檚 generating easy growth, like buy now, pay later (BNPL) and Braintree, while reinvesting money back into core areas. If this strategy is successful, it could prompt PayPal to offload other non-core business units.

New payment methods like buy now, pay later (BNPL) and account-to-account (A2A) payments are cheaper for sellers. Besides increasingly accepting these methods, sellers may promote them more heavily to drive customer usage. Outside of the US, domestic payment networks like India鈥檚 Unified Payments Interface are emerging as card alternatives.

笔补测笔补濒鈥檚 buy now, pay later (BNPL) program spurred strong checkout volume and TPV increases. It鈥檚 offered nearly 200 million loans to almost 30 million customers globally since launching in 2020. The program is available at about 300,000 merchants worldwide. Transaction volume was mostly driven by Venmo and Braintree, 笔补测笔补濒鈥檚 payment gateway geared toward larger merchants.

But a dynamic experience would know when to offer customers a BNPL option or an application for a credit card. Consistency across all channels is also key to a successful payments strategy, Crisologo added. For instance, if a BNPL option is available online, it should also be available in store.

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.

The tool can help Klarna stand out from BNPL competitors, potentially leading to higher market share in the long run as BNPL spending grows: US BNPL payment volume is expected to increase 25.5% year over year in 2023, per Insider Intelligence forecasts.

Gen Zers have also taken to Buy Now Pay Later (BNPL), which makes emotional spending even easier. These young shoppers rely on embedded finance over three times more than baby boomers. But Gen Z wants to be more responsible: This self-aware generation knows their habits are detrimental to their financial wellness, and they want to change.

Cash App Card and its buy now, pay later (BNPL) platform contributed to that growth. In March, Cash App Card had 20 million monthly active users, up 34% YoY. Average spend per user also increased. Block has focused on growing the Cash App ecosystem through products like its debit card and Cash App savings.

Shoppers get a little help from BNPL. The stat: On Cyber Monday, shoppers used buy now, pay later (BNPL) services to pay for $940 million worth of online purchases, the biggest day ever for BNPL, per Adobe Analytics. What it means: BNPL is here to stay, particularly among millennials and Gen Zers, who will represent 60 million BNPL users next year, per our June 2023 forecast.

A slew of new entrants in the BNPL space has made it harder for Klarna and Sezzle to grab more market share. PayPal, Visa, and Mastercard all ramped up their BNPL programs in 2022. BNPL providers across the board aren鈥檛 seeing the same volume growth they did in 2020鈥攚hich can be partly attributed to normalizing ecommerce growth. What鈥檚 next?

While buy now, pay later (BNPL) is its mainstay solution, Klarna wants to be more than just a BNPL provider; it鈥檚 building out customer tools through the Klarna app. Some of Klarna鈥檚 most popular app features include its search engine, money management features, and creator platform, all of which help drive engagement and customer loyalty.

鈥淎 lot of Gen Zers are jumping onto buy now, pay later [BNPL] because they either don鈥檛 want to embrace traditional credit cards or don鈥檛 have the credit yet,鈥� said Feger, who expects the service to become even more popular for holiday shopping.

Buy now, pay later gains steam. Over the holidays, buy now, pay later (BNPL) use picked up as consumers looked for alternative ways to fund their shopping. This year, BNPL will continue gaining users and growing payment value by 25.5% to reach $94.87 billion. By 2026, nearly 40% of internet users will have used a BNPL solution.

Younger consumers will lean on BNPL to finance their holiday purchases. Gen Zers are more likely than other demographics to finance holiday gifts with buy now, pay later (BNPL). 蘑菇AV 39% of Gen Zers will use BNPL over the holidays, as opposed to just 9% of baby boomers and 21% of Gen X consumers, per i2c and PYMNTS.

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.

Payments pay off: Innovations in payments will unlock more spend from Gen Z as buy now, pay later (BNPL) integration becomes even more seamless. Apple announced its own BNPL product last week, which could boost adoption even further. We already estimate that more than half (57.9%) of Gen Z digital buyers in the US use BNPL.

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.

Buy now, pay later (BNPL) usage is on the rise. Shoppers used BNPL to pay for $940 million worth of online purchases on Cyber Monday, a 42.5% increase YoY and an all-time high, per Adobe Analytics. Consumers are also taking advantage of the flexible payment service to increase the size of their carts: The number of items per order using BNPL was 11% higher YoY.

Expand buy now, pay later (BNPL) to physical stores. Cash-strapped consumers will look for ways to stretch their dollars during the holidays. These shoppers will be ready to use BNPL at brick-and-mortar locations, meaning retailers can capture incremental purchases by providing in-store payment alternatives.

The shift: BNPL innovation drives its payment share forward. BNPL blends the flexibility of credit, short repayment terms, and app-based shopping into a simple, easy user experience. It will account for 12.1% of ecommerce payments by 2025, according to FIS. The demographics: Older consumers are supplementing BNPL growth.

Consumer complaints have also ramped up, largely related to new technologies NBFIs offer like buy now, pay later (BNPL) and digital currencies. Financial regulators have seemingly stalled on regulations due to the complex interconnectedness of NBFIs and the regulated banking sector, and the quickly developing innovation that NBFIs bring to the financial sector.

For example, buy now, pay later (BNPL) orders jumped 85% the week of November 19 compared with the previous week. BNPL revenues rose 88% over the same period. The big takeaway: Despite the challenging economic climate, consumer spending outpaced inflation. That鈥檚 a good sign for the rest of the holiday season. We expect 7.0% retail sales growth this holiday season.

Younger consumers are propping up nascent BNPL growth. The opportunity: BNPL represented 3% of ecommerce payment value in 2021, or C$3.02 billion ($2.32 billion). As of 2022, 3% of Canada consumers had used BNPL in the past 30 days. That鈥檚 less than one-third of US users and one-sixth of UK users.