BASINGSTOKE, U.K. –The number of buy now, pay later (BNPL) users will surpass 900 million globally by 2027, increasing from 360 million in 2022, according to a new study from Juniper Research.
“This substantial growth of 157% will be driven by the anticipated economic downturn, which will increase the demand for low-cost credit solutions,” the company said in releasing its findings.
The report noted that BNPL services do not require hard credit checks and an increasing number of merchants are accepting this payment method, making it easier to access for consumers than traditional credit.
High Growth Markets
The research identified India as having potential for rapid growth in BNPL, with users predicted to grow from 25 million in 2022 to 116 million by 2027.
“This is due to rising eCommerce usage and growing interest in international goods available through online retailers,” Juniper said. “In turn, it recommends that vendors build strategic partnerships with vendors in developing markets with established consumer bases, to successfully capitalize on this user growth and associated revenue.”
Virtual Cards to Further Boost Usage
In addition, Juniper said the research predicts the adoption of virtual cards, where digital only cards are used for purchases, will increase the usage of BNPL solutions, as they only require merchants to accept card payments - overcoming previous limitations on growth.
“The advancement of virtual cards allows BNPL schemes to compete with credit cards; particularly in-store, where single use BNPL cards can be used within a digital wallet to complete contactless actions,” Juniper Research said.
Juniper Research is recommending that in order to compete in this highly competitive landscape, BNPL vendors must differentiate their services, including offering virtual cards, browser extensions that automatically facilitate BNPL payment services, and digital loyalty schemes.
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