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The Evolution of BNPL (Buy Now, Pay Later): What Changed, And What’s Coming Next?


In today’s fast-paced world, people want instant gratification. With the rise of online shopping and the proliferation of mobile devices, consumers have become used to having instant access to whatever they want, whenever they want it.

This has created a new set of challenges for retailers, who now have to compete not only on price but also on convenience and speed.

Buy now, pay later (BNPL) has meant that BNPL companies, such as Flava and Hokodo, have been able to offer their customers the ability to spread the cost of their purchases over time. This has been a game-changer for many customers, who can now buy what they want without having to fork out the full amount.

Driving Factors of BNPL’s Popularity

As the global economy took a turn for the worse in 2008, many consumers struggled to keep up with their traditional payment methods. This is where buy now, pay later services stepped in as a viable solution for those who needed a little extra time to pay for their purchases.

Over the years, these services have only become more popular, with more and more companies offering them. There are a few key reasons for this popularity:

  • Ease of use: BNPL services are easy to use and understand. Customers simply choose to pay with BNPL at checkout, and they can then spread the cost of their purchase.
  • Safety and security: BNPL is heavily regulated, so customers can be confident that their personal and financial information is safe.
  • The growing trend of online shopping: The Internet makes it easy for customers to shop around and compare prices. BNPL services provide an additional level of convenience for those who prefer to shop online.
  • Variety Options: BNPL providers now offer a wider range of options, making it easier for consumers to find a plan that suits their needs.

Shoppers Love the Flexibility of BNPL

For many shoppers, BNPL provides a much-needed lifeline. It allows them to buy items they may not afford upfront and spread the cost over a period that suits them. This flexibility has made BNPL extremely popular, particularly with millennials and Generation Z who make up a large proportion of the online shopping market.

The popularity of BNPL is also reflected in the growth of the industry. In 2020, the global BNPL market was valued at $90.69 billion. This is expected to grow to $3.98 trillion by 2030, at a CAGR of 45.7%.

BNPL appeals to shoppers who are looking to avoid debt. Unlike traditional credit cards, which can charge high-interest rates, BNPL providers rarely charge interest or fees.

Also, BNPL can be used for both small and large purchases, making it an attractive option for a wide range of shoppers.

BNPL is Boosting Sales and Customer Loyalty

BNPL schemes make it easier for customers to make impulse buys, which is great news for businesses. The ease of use and flexibility that BNPL offers encourages customers to return to the same store or brand, rather than looking elsewhere for a better deal.

BNPL can help businesses to attract new customers. It is estimated that BNPL schemes could increase sales by up to 30%. Shoppers who wouldn’t normally consider using credit are more likely to make a purchase if they can spread the cost.

The increased sales that BNPL can bring are not just a short-term boost. Retailers who offer BNPL also benefit from increased customer data. This data can better understand customer behaviour and preferences and decisions about future marketing and product strategies.

What’s coming next for BNPL?

The buy now, pay later industry is still in its early stages, and there is plenty of room for growth. In the coming years, we can expect to see more businesses offering BNPL schemes, as well as more innovation in the space.

One area that is ripe for development is BNPL for business purchases. B2B BNPL could make it easier for small businesses to manage their cash flow and grow.

Another area of growth is BNPL for subscription services. This could allow customers to pay for their subscriptions in instalments, making it more affordable and reducing the barriers to entry.

Open loop BNPL schemes will also become more common. These schemes, which are not linked to a specific retailer or merchant, give shoppers more flexibility in how they use the credit.

Finally, we may see BNPL providers teaming up with traditional financial institutions. Regulation around BNPL is expected to tighten in the coming years, and banks may see partnering with BNPL providers to stay ahead of the curve.


The adoption of BNPL is a win-win for businesses and shoppers alike. Businesses get a boost in sales, while shoppers get the flexibility and convenience that they crave.

The BNPL industry has seen tremendous growth in recent years and is showing no signs of slowing down. This growth is being driven by innovation, with new applications and partnerships opening up the possibilities for BNPL.


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