Economic recession looms over the US peak season, and “buy now, pay later” drives e-commerce transaction growth!

It is learned that according to a study by Harvard University, due to rising inflation and life pressure, Americans now prefer "buy now, pay later" (BNPL) more than ever before.

Under economic pressure, "buy now, pay later" is rising strongly

The latest data from Adobe shows that during this year's Black Friday and Cyber ​​Monday, the volume of "buy now, pay later" transactions through companies such as Klarna, Zip, Zilch, Affirm and Afterpay increased by 85%, and the transaction value increased by 88% (compared with the previous week).

More than half of shoppers used BNPL to buy items they could not repay in 2021, according to a survey by US online bank Oxygen.

Marshall Lux, a senior fellow at Harvard Kennedy School, said the surge in buy now, pay later transactions shows how much financial pressure Americans are under, especially for ordinary people.

It is learned that although inflation in the United States eased in October, the inflation level is still very high. Compared with the same period last year, the price of goods in October increased by 7.7%, close to the highest record since the early 1980s. In early November, 60% of Americans reported that they lived on their monthly salary instead of saving.

“Buy now, pay later” drives online shopping growth

According to Adobe data, despite various unfavorable factors, online shopping spending in the United States on Black Friday and Cyber ​​Monday still hit record highs, reaching US$9.12 billion and US$11.3 billion respectively.

In addition, a report from the National Retail Federation showed that approximately 196.7 million Americans shopped in stores and online over the five-day Thanksgiving weekend, also a record high in the number of shoppers.

NRF CEO Matthew Shay said that as inflation continues to rise, American consumers are doing everything they can to save money this holiday season. In some cases, they are turning to additional credit facilities.

The study found that the rapid growth of buy now, pay later this holiday season was driven primarily by younger consumers, and that Americans were particularly fond of using buy now, pay later when purchasing big-ticket items.

Marshall Lux said that with rising prices, "buy now, pay later" provides a "lifeline" for many consumers who can't afford to buy things. Ashmi Pancholi, vice president of consumer insights at Affirm, said that "buy now, pay later" provides consumers with a valuable budgeting tool to help them control their finances and enjoy the joy of holiday shopping as much as possible.

It is worth noting that the study also found that consumers with "BNPL" accounts are more likely to have records of overspending, missed or late payments, and poor credit records.

Editor ✎ Nicole/

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