According to a report carried out by Grand View Research, the Buy Now, Pay Later (BNPL) market is expected to be worth up to $39.4 billion by 2030.
Forecasted to reach a CAGR (Compound Annual Growth Rate) of 26% between 2022-2030, the report attributed the growth of the BNPL market to ‘new innovative approaches’ coupled with interest-free convenient payments along with additional benefits for customers.
Since the increased presence of BNPL platforms becoming more of a preference for shoppers, research has found that more ecommerce companies are partnering with BNPL service providers. This in turn has only furthered the reliance of online payment channels.
BNPL, according to the report, has shown to help enterprises in managing their expenses with flexible and transparent fee options. Small and Medium Enterprises (SMEs) are also turning their attention to BNPL services as a means to maximise their tax deductions.
Millennials have been reported to be a key demographic when it comes to using BNPL services. With millennials using these services to predominantly purchase clothing items in instalments, this has also translated in the rise of BNPL services in North America, which is expected to grow further during the forecasted period.
One growing trend of the market see’s more fintech companies partnering with BNPL operators. Payment solution provider Till Payments partnered up with BNPL platform Openpay in October 2021 to provide flexible payment options for consumers across New Zealand and Australia.
Partnerships like these are expected to enhance the online shopping experience with more flexible options at the Point of Sale (PoS) terminal. Several fintech firms have also worked on implementing BNPL options to their own payment systems. An instance of this is when Payflex launched a BNPL feature for consumers in South Africa.
The research also noted that the COVID-19 pandemic is likely to have a positive effect on the market. With a heavily accelerated usage of online shopping and payment methods, company’s have had to adjust and adopt BNPL offerings for a better customer experience.