Analysis from global consulting partnership Kearney has revealed that UK millenials are increasingly likely to utilise point of sale (PoS) credit finance – otherwise known as ‘buy now, pay later’.
According to the report, the service has experienced a surge among younger UK consumers, with over 60% of millennials now utilising the service.
As well as this, a majority of consumers in Generation X (57%) have also used this type of at-checkout finance, with over a third (34%) having done so on more than one occasion.
Sameer Pethe, Principal at Kearney commented: “The findings outlined in this report reveal the potential opportunities for a service provider to be able to develop and market a genuinely easy to use, transparent PoS credit service. Today, this is a very fragmented market: a good proposition linked to a trusted brand could capture a substantial market share.”
The report, ‘Credit uncrunched: why banks and retailers must develop more PoS credit services’, revealed that while adoption is low overall – 41% of UK shoppers have still never used these services – consumers would be more willing to use these credit options if they provide ease of use, value for money and transparency over any charges.
Point of sale credit finance has been used in different forms for a long time, but in recent years, this market has changed significantly with the introduction of new services including PayPal Credit, Klarna and Clearpay. As these services have become more available, consumers are becoming more open to this form of credit.
Nearly 60% (58%) of shoppers would use PoS credit for a purchase over £250, whether or not they could pay the full price up front – including 12% who would use the credit to trade-up and buy a more expensive product.