Over eight million people are using BNPL for purchases under £50

New research from TransUnion UK has revealed that over eight million people are using Buy Now Pay Later (BNPL) for items under £50, whilst 4% put purchases under £25 on this short-term credit.

Over a quarter (26%) of people now prefer to use BNPL over credit cards for everyday spending, with 18 to 24-year-olds (20%) most likely to rely on this short-term credit for ‘bitesize’ purchases. One in ten (10%) consumers pay for their weekly shop with BNPL, while a similar number spread the cost of takeaways (9%) and coffee drinks (7%).

Madhu Kejriwal, CEO of TransUnion in the UK and Europe, said “Consumers have embraced the broader choice buy now, pay later services offer. They’re generally easy to use as they provide a good consumer journey and can additionally be a useful option for people with more limited credit opportunities. With its rising popularity, new regulation on BNPL is a positive and timely step to help protect consumers from taking on more debt than they can repay and supports responsible lending.”

Ahead of the new school year, 6% of people are turning to BNPL for school supplies – rising to 15% among younger parents between 25 and 34 years old. However, nearly two in five (19%) adults who buy school equipment with BNPL say they are financially comfortable, suggesting that for some at least, it’s a choice of convenience, not necessity. Plus, as petrol prices continue to rise, 7% of people are paying for fuel with BNPL, while 8% rely on it to cover essential travel and commuting.

As inflation continues to exceed the Bank of England’s target of 2%, rising to 3.5% in April 2025, up from 2.6% in March nearly a quarter (23%) of BNPL users put low-cost purchases on short-term credit to manage the rising cost of living. One in seven (14%) use ‘bitesize’ BNPL for budgeting, with this highest among 45 to 54-year-olds (20%), and 13% rely on this payment method to afford essential items.

Being easy to use (60%) and widely available (34%) are driving BNPL’s popularity, but for 16% of consumers, BNPL is their preferred form of short-term credit as it requires fewer credit checks. In fact, 8% have turned to BNPL after having a credit application declined by a mainstream lender.

Kejriwal concluded “BNPL can be a quick way to access credit, and while using short-term financing for smaller purchases isn’t a cause of alarm, missed or late payments, even for low-cost items, are visible on your credit report and may negatively impact future access to credit. Ahead of regulations, it’s key that consumers understand how BNPL loans can affect their credit report. At TransUnion, we have a comprehensive view of consumer behaviour and affordability, helping businesses lend responsibly and consumers better understand their credit commitments.”