Last updated: September 2026. Editorial Team — researched using data from the Federal Reserve Bank of Richmond, LendingTree, and Chargeflow, with additional regulatory analysis from WeGetFinancing. See “Sources & Methodology” for our full source list.
Quick Answer
Buy Now, Pay Later usage keeps climbing, with global gross merchandise volume reaching roughly $560 billion in 2025, and LendingTree’s 2026 report finding 47% of BNPL users have paid late at least once in the past year — up from 41% in 2025 and 34% two years ago, a genuinely accelerating trend. Yet the Federal Reserve Bank of Richmond’s own March 2026 research offers a more reassuring counterpoint at the systemic level: at BNPL’s current scale, there is no clear evidence the product poses material risks to overall financial stability or has generated significant spillovers into other consumer credit markets. Regulation is arriving unevenly across the globe — the EU and UK are moving toward mandatory affordability checks in 2026, while in the US, the CFPB withdrew its 2024 interpretive rule, pushing enforcement down to a state-by-state patchwork instead.
The Genuine Scale of BNPL Today
Chargeflow’s 2026 market research puts global BNPL gross merchandise volume at approximately $560.1 billion in 2025, a 13.7% year-over-year increase, with global users reaching roughly 380 million in 2024 and projected to grow to around 670 million by 2028. In the US specifically, the Richmond Fed’s research shows BNPL reached an estimated $70 billion in transactions in 2025 — still a comparatively small share, about 1.1%, of total US credit card spending, but growing at roughly 20% annually in real terms since 2021. The average BNPL transaction in the US runs about $135, and monthly spending per user grew from $201.60 in June 2024 to $243.90 in June 2025, a 21% increase — genuinely fast growth in per-user engagement, not just total user count.
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The Late-Payment Trend Is Genuinely Worsening
This is the clearest warning signal in the current data. LendingTree’s 2026 report found 47% of BNPL users have paid late in the past year, a figure that has climbed steadily: up from 41% in 2025, and 34% two years before that. That’s a meaningful, sustained upward trajectory rather than a one-time blip. Chargeflow’s separate analysis adds a related data point worth understanding precisely: BNPL default rates, or charge-offs (loans written off as unlikely to be repaid) remain relatively low, at roughly 1.8% to 2%, even as approximately 34% to 41% of users report making at least one late payment — highlighting a genuinely important gap between short-term delinquency (a late payment that’s eventually made) and actual defaults (a loan the lender doesn’t expect to collect). Most late payments, in other words, do get paid eventually; the concern is the growing share of users experiencing that stress in the first place, not necessarily a wave of unrecoverable losses.
Why the Fed Isn’t (Yet) Sounding a Systemic Alarm
The Richmond Fed’s economic brief offers a useful, more measured counterpoint to the more alarming late-payment statistics. Its core finding: at its current scale, there is no clear evidence that BNPL poses material risks to financial stability or has generated significant spillovers to other consumer credit markets. At the individual consumer level, the research finds BNPL users generally retain access to traditional credit and tend to carry higher debt than nonusers, though there is no clear evidence of a causal link between BNPL use and higher indebtedness — an important methodological caution, since BNPL users and higher debt levels could simply share other underlying characteristics rather than BNPL itself causing the higher debt. The Richmond Fed characterizes BNPL’s overall welfare effects as genuinely mixed: potentially lowering borrowing costs for some consumers while increasing risks for others with more limited financial resources or planning capacity.
Gen Z Is Both the Growth Engine and the Risk Case
H33’s market outlook analysis identifies a specific demographic pattern that captures the tension at the heart of the BNPL story: Gen Z keeps the growth engine running, but also makes the risk case simultaneously. Bankrate found 66% of Gen Z BNPL users had experienced at least one issue, including overspending or missed payments — a genuinely high incidence rate within the demographic driving much of the product’s continued growth. More than half of BNPL users overall in 2026 say they couldn’t make ends meet without access to BNPL, according to industry survey data — a striking admission that speaks to how embedded the product has become in some users’ basic monthly budgeting, for better or worse depending on their broader financial situation.
Regulation Is Arriving, Unevenly, Around the World
WeGetFinancing’s analysis frames the regulatory shift bluntly: “the regulatory free ride is over” for BNPL providers. In the European Union, member states were required to transpose the Consumer Credit Directive II into national law by the end of 2025, with full enforcement expected across the bloc by Q4 2026 — eliminating the short-term interest-free exemption that had previously let third-party BNPL providers largely sidestep traditional consumer-credit rules, and mandating creditworthiness assessments before approval. In the UK, Financial Conduct Authority oversight is expected by mid-2026, introducing mandatory affordability checks, credit bureau reporting, and access to the Financial Ombudsman Service for dispute resolution. In the US, by contrast, the picture is genuinely more fragmented: the Consumer Financial Protection Bureau withdrew its 2024 interpretive rule, pushing enforcement down to the state level — a patchwork approach that WeGetFinancing notes creates compliance complexity for providers without necessarily reducing the overall regulatory pressure they face.
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A Cautionary Case Study From Australia
A separate policy analysis flags a specific, concrete precedent worth understanding: a 2025 Afterpay default wave in Australia, which reached a 7% default rate, prompted the Australian Securities and Investments Commission to impose full licensing requirements on BNPL providers — a regulatory response that stabilized the market but also shrank overall BNPL transaction volumes by roughly 15% in the process. That’s a useful real-world data point for weighing the trade-off regulators face more broadly: stricter oversight can genuinely reduce consumer harm, but it also measurably constrains the product’s growth and availability, a trade-off playing out differently across each jurisdiction currently tightening its own rules.
What This Means for BNPL Users
- Late payments are becoming more common, not less: The rising share of users paying late (47%, up from 34% two years ago) suggests growing cash-flow strain among at least a meaningful subset of the user base.
- Low default rates don’t mean low stress: A roughly 2% charge-off rate coexists with far higher rates of at least occasional late payment, meaning most BNPL debt does eventually get repaid, but often only after some financial strain.
- Regulatory protections vary significantly by country: UK and EU users are gaining stronger affordability-check protections in 2026; US users currently rely on a more fragmented, state-by-state regulatory patchwork.
- Multiple concurrent BNPL loans compound risk: Without a centralized dashboard tracking payments across different providers, users juggling several simultaneous BNPL plans can accumulate obligations more easily than with a single traditional credit line.
Frequently Asked Questions
How many people use Buy Now, Pay Later services?
Global BNPL users reached approximately 380 million in 2024, with global gross merchandise volume around $560 billion in 2025, and usage is projected to keep growing through 2028.
What percentage of BNPL users pay late?
47% of BNPL users reported paying late at least once in the past year, according to LendingTree’s 2026 report, up from 41% in 2025 and 34% two years earlier.
Does BNPL pose a risk to the financial system?
According to the Federal Reserve Bank of Richmond, at its current scale, there’s no clear evidence BNPL poses material risks to overall financial stability or generates significant spillovers to other consumer credit markets.
How is BNPL being regulated in 2026?
The EU is enforcing the Consumer Credit Directive II by Q4 2026, and the UK’s FCA is introducing mandatory affordability checks by mid-2026. In the US, the CFPB withdrew its 2024 interpretive rule, leaving enforcement to individual states.
Sources & Methodology
This article draws on data and analysis from: the Federal Reserve Bank of Richmond’s March 2026 economic brief on BNPL developments and implications; LendingTree’s 2026 BNPL statistics report; Chargeflow’s 2026 buy now pay later market research; H33’s June 2026 BNPL market outlook, including Bankrate’s Gen Z survey data; and WeGetFinancing’s analysis of 2026 global BNPL regulatory developments, including EU, UK, and Australian regulatory actions. Figures reflect the most recently published data as of this article’s last-updated date.
This article is for informational purposes and does not constitute financial advice.