THE

TRUTH ABOUT
BNPL
The Truth About BNPL And Store Cards Report details
the differences in how consumers perceive and use

AND
store cards and BNPL options. The report draws from
a survey of a census-balanced panel of 2,161 U.S.

STORE
consumers conducted between Dec. 10 to Dec. 17, 2021,
to determine how many of them shop with merchants
that offer store cards and to discover whether they
use those cards or other payment methods to make
their purchases.

CARDS
March 2022
 Table of
Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 01

Key Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 03

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

About . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

The Truth About BNPL And Store Cards Report

was done in collaboration with PayPal, and
PYMNTS is grateful for the company’s support
and insight. PYMNTS.com retains full editorial
control over the following findings, methodology
and data analysis.
1 | The Truth About BNPL And Store Cards Report Introduction | 2

Introduction

This is what
The buy now, pay later (BNPL) rev- from merchants that offered store The Truth About BNPL And Store Cards
olution is well underway: 52 million cards within the past 30 days, and just Report, a PYMNTS and PayPal collab-

we learned.
consumers in the United States had 8.3% (a projected 4.9 million) of them oration, details the differences in how
used the method to make purchases by paid for those purchases using BNPL consumers perceive and use store
December 2021.1 This meteoric rise has options.3 cards and BNPL options. The report
not gone unnoticed by traditional credit surveyed a census-balanced panel of
This does not mean that consumers lack
issuers. They worry that BNPL rep- 2,161 U.S. consumers from Dec. 10 to
interest in using BNPL at the retail point
resents a potent threat to their market Dec. 17, 2021, to determine how many
of sale (POS). Instead, they see BNPL as
share as they fight to stay top-of-wallet. of them shop with merchants that offer
an option that differs from store cards
store cards, discover whether they use
While BNPL continues to disrupt the and offers distinct and unique benefits.
those cards or other payment methods
traditional credit market in the U.S. Sixty-eight percent of U.S. consumers
to make their purchases and under-
and abroad, one type of credit product believe BNPL could help them man-
stand why there is virtually no risk of
appears to be virtually immune to BNPL age their spending, and 78% would be
BNPL options cannibalizing store card–
cannibalization: store cards.2 PYMNTS’ inclined to use BNPL options to make
driven sales.
latest research shows that roughly 59 larger purchases that they otherwise
million U.S. consumers made purchases would not have the funds to buy.

1
2022 Global Digital Shopping Index. PYMNTS.com. 2022. https://www.pymnts.com/study/2022-global-digital-shopping-index-ecommerce-re-
tail/#wpcf7-f1245207-o1. Accessed February 2022.
2
Our survey defines “store cards” as those issued by merchants, which may only be used when making purchases with those merchants.
3
The "59 million U.S. consumers" and "4.9 million" U.S. consumers statistics references in this sentence are estimates calculated by applying data collected from
our survey of a census-balanced sample of consumers and applying it to the broader adult U.S. population. Estimates like these are used throughout this report in
order to provide a sense of scale and to help illustrate the broader implications of our findings. © 2022 PYMNTS.com All Rights Reserved
3 | The Truth About BNPL And Store Cards Report Introduction | 4

Given the choice, Consumers tend Forty-two percent

most store card to use store cards of consumers who

holders choose and BNPL options

used store cards for
their most recent

store cards. for different eligible purchases

did so because
A negligible number of consumers with
store cards used BNPL for their most reasons. it earned them
more rewards than
recent store card–eligible purchase. Accessing rewards is the most common
reason consumers use store cards, other payment
Consumers use store cards 87% of the
while having the ability to make larger methods. Just 22%
time when they can. The remaining purchases is the most common reason
13% of consumers with store cards pay they use BNPL options. of shoppers who
using debit cards, credit cards or cash. did not use store
Zero percent of consumers with store Forty-two percent of consumers who used
store cards for their most recent eligible cards to make their
cards paid for their most recent eligible
purchases via BNPL. purchases did so because it earned them most recent eligible
more rewards than other payment methods. purchases said they
Just 22% of shoppers who did not use
store cards to make their most recent eli-
did not use store
gible purchases said they did not use store cards because
cards because they found better rewards they found better
using other payment methods.
rewards using other
payment methods.

© 2022 PYMNTS.com All Rights Reserved

5 | The Truth About BNPL And Store Cards Report Key Findings | 6

When store card holders use BNPL, Just 4% of store card holders
they often use it for one specific said they are likely to just use
type of item: those with high BNPL in the next three months.
price tags. Twelve percent are likely to use
Thirty-nine percent of all store card users say they have used BNPL at least once
a combination of BNPL and store
cards in that time.
in the past, but just 8.3% of consumers who have store cards have used BNPL to
make purchases in the past 30 days. Those cardholders who paid via BNPL are likely
to have used it for purchases with high price tags. Our research shows that 32% of
consumers would be more likely to use BNPL rather than store cards for purchases
Store card holders from Generation Z were the most likely of any age group to plan
of more than $1,000, nearly double the 17% that said the same for purchases costing
on paying via BNPL in the next three months, and millennials were a close second.
less than $250.
Even among Gen Z and millennial store card holders, however, just 8% and 6%
intended to use BNPL for purchases within the next three months, respectively.

© 2022 PYMNTS.com All Rights Reserved

7 | The Truth About BNPL And Store Cards Report Key Findings | 8

Understanding the store

Even when shoppers opt not to use Table 1:
their store cards for eligible purchases, Consumers’ reasons for
they principally pay using either debit using or not using store

card-BNPL divide
or credit cards — and rarely, if ever, pay
with BNPL options. Our research finds
cards during eligible
that 7% of store card holders used debit purchases
cards to make their most recent store
Share of consumers who cited select reasons
card–eligible purchases, and 4% used for paying for their most recent store card–
eligible purchases, by whether they paid via
credit cards. Just 0.2% of store card store card or other methods
holders paid for their recent eligible
When consumers can pay with store cards, they tend to follow through. Our research purchases using PayPal. These findings
Store Cards Other Methods
shows that 87% of the storecard holders who have shopped in the past 30 days have make it abundantly clear that consum-
used those cards to make their most recent eligible purchases. That means that just ers rarely consider BNPL options when
Other 3% 12%
13% of consumers who shopped with merchants with which they had store cards making store card–eligible purchases.
Funds availability 1% 0%
chose to pay using another method.
Consumers tend to use store cards High dollar value 3% 0%

when they can for a few key reasons, Low dollar value 4% 3%
Figure 1:
namely rewards options and comfort Better expense management 12% 20%
Consumers’ usage of and speed. Forty-two percent of card- Comfort or speed 36% 40%
store cards when holders who paid with store cards the Rewards 42% 22%
they are available last time they made an eligible pur-
Source: PYMNTS.com
1A: Share of consumers who used select 1B: Share of consumers with store card that chase said they did so because of
methods to pay for their most recent store used another payment method for a store rewards, and 36% who paid with their
card–eligible purchase card-eligible purchase
cards did so because it was comfort- Forty percent of the cardholders who
PayPal
Store Card 0% able and fast. did not use their cards to make their
87% 0000000087

Gift/prepaid card most recent eligible purchases said it

Other method 0% Just 22% of store card holders who did
was because using credit cards, debit
13% 0000000013
not use their cards to make their most
Source: PYMNTS.com Cash cards or, to a lesser extent, PayPal
2% 0000000002
recent eligible purchases did so to earn
was faster and more comfortable.
Credit Card rewards using other payment methods.
4% 0000000004 Consumers also considered whether
It is therefore clear that rewards pro-
Debit Card their purchases were priced at a low
7% grams are one of the key differentiators
0000000007
or high dollar value, whether they had
Source: PYMNTS.com
separating consumers’ use of store
funds needed to make a given purchase
cards from other payment options.
and other factors when deciding how to
pay, but these considerations were less
common.

© 2022 PYMNTS.com All Rights Reserved

 Key findings | 10

Driving payment decisions:

Figure 2:

Factors that influence

whether consumers use

What consumers want from

BNPL or store cards to pay

store cards versus BNPL

Share of consumers who would be more
likely to pay using store cards or BNPL for
select factors

The rewards associated with each

payment method
51% 0000000051

One of the reasons there is so little overlap between BNPL and store card usage 34% 0000000034

15%
is that consumers expect different benefits from each. The foremost benefit they
0000000015

believe they can gain from using store cards is access to rewards, but the benefits
they most often relay regarding BNPL options relate to pricing. For products that cost less than $250
54% 0000000054

The higher the price, the more likely consumers are to use BNPL. Our research shows 29% 0000000029

17% 0000000017

that 32% of all consumers would be more likely to pay with BNPL than store cards for
purchases costing more than $1,000. Just 17% would be more likely to pay via BNPL
For products that cost between $250 and
than store cards for items costing less than $250. $1,000
41% 0000000041

33% 0000000033

25% 0000000025

For products that cost more than $1,000

37% 0000000037

31% 0000000031

32% 0000000032

2.5x
The trust you have in the providers of
each alternative
37% 0000000037

Consumers are roughly more likely to 48%

15%
0000000048

0000000015

use store cards than BNPL to pay for items

Source: PYMNTS.com

costing less than $250. More likely to use store cards

Equally likely
More likely to use BNPL

© 2022 PYMNTS.com All Rights Reserved

11 | The Truth About BNPL And Store Cards Report Key findings | 12

Figure 3: Consumers see BNPL options as a

Benefits consumers helpful way to make large purchases
and as an effective way to track their
associate with store
payments. Sixty-eight percent of con-
cards or BNPL sumers believe BNPL options allow
Share of consumers who agree or disagree them to better track the payments
with select statements about store cards and they make for their purchases and 78%
BNPL options

64%
believe BNPL options allow them to
Allows to make larger purchases Provide better rewards make larger purchases. Forty-one per-
cent of consumers believe store cards
BNPL BNPL
78% 0000000078
57% 0000000057 allow them to make larger purchases
15% 0000000015
28% 0000000028
and 42% believe store cards make
7% 0000000007 15% 0000000015

payments easier to track than other

Store Card Store Card
41% 0000000041
64% 0000000065
options.
38% 0000000038
25% 0000000025

21% 0000000021 11% 0000000011

Another distinction between store cards
and BNPL options in consumers’ eyes is
that many consumers use store cards Share of consumers
Payments are easier to track compared as a sort of alternative credit product.
to other credit options
Our research shows that 28% prefer
who believe store
BNPL BNPL makes it easier to make payments using store cards to using cards issued cards provide
68% 0000000068
79% 0000000079

25%
7%
0000000025 15%
6%
0000000015 by the two big card networks, Visa or better rewards
Mastercard.
0000000007 0000000006

Prefer BNPL because it allows me to than BNPL options

Store Card maintain cash cushion
42% 0000000042
81% 0000000081

38% 0000000038 14% 0000000014

20% 0000000020 6% 0000000006

Prefer store card to Visa or Mastercard

28% 0000000028

38% 0000000038

34% 0000000034

Source: PYMNTS.com

Agree
Neither Agree nor disagree
Disagree

© 2022 PYMNTS.com All Rights Reserved

13 | The Truth About BNPL And Store Cards Report Key findings | 14

THE
Figure 4:

SCALE OF STORE
U.S. consumers’
ownership of store cards

U.S.
CARD OWNERSHIP
Share of U.S. consumers who own at least one
store card, by demographic group

Sample

28%
28% 0000000028

Generation

IN THE
Baby boomers and seniors
34% 0000000034

Generation X
31% 0000000031

Bridge Millennials
26% 0000000026

Millennials
26% 0000000026

Generation Z
11% 0000000011 Share of U.S.
Income
consumers who
More than $100K own at least
32%
one store card
0000000032

PYMNTS’ latest research shows that 28% of all U.S. consumers own at least one $50K-$100K
34% 0000000034
store card and that the average store card owner keeps roughly two such cards. Baby
boomers and seniors and Generation X consumers exceed the average, as 34% and Less than $50K
19% 0000000019

31% of consumers in these age groups own at least one store card, respectively. Source: PYMNTS.com

© 2022 PYMNTS.com All Rights Reserved

15 | The Truth About BNPL And Store Cards Report Key findings | 16

Looking back,
Figure 5:

Consumers’ past usage

of BNPL options with

going forward
merchants where they
have store cards
Share of consumers who have paid via BNPL
at least once at a merchant with which they
held a store card

Average
61% 0000000061

The glaring differences between how Middle-income consumers and those 39% 0000000039

consumers perceive and use store with the most stable finances are also
cards and BNPL options mean that they among those most likely to have used Generation Income
rarely wind up using one or the other to BNPL options in the past. Our research
More than $100K
purchase the same products. Just 39% shows that 46% of middle-income con- Baby boomers and seniors 56% 0000000056

63% 0000000063
44% 0000000044

of consumers have ever used BNPL at sumers have used BNPL at merchants 37% 0000000037

merchants where they held store cards, where they have store cards in the past, $50K-$100K
Generation X 54% 0000000062

in fact. as have 43% of those who report that 65% 0000000065

46% 0000000046

35% 0000000035

they do not live paycheck to paycheck.

The share of consumers who have Less than $50K
Bridge Millennials
used BNPL at merchants where they Millennials and Gen Z are among the 62% 0000000062 76% 0000000076

38% 0000000038 24% 0000000024

hold store cards increases among mil- most likely to use BNPL for future pay- Source: PYMNTS.com

lennials, however. Millennials are the ments. Six percent of millennials intend Millennials I have not used BNPL at this merchant
most likely of all generations to have to pay exclusively using BNPL within the 54% 0000000054 I have used BNPL at this merchant
46% 0000000046

used BNPL at these merchants, as 46% next three months, and 21% plan to pay
have done so. This contrasts with baby using a mix of BNPL and store cards Generation Z
63% 0000000063

boomers and seniors, of whom just 37% within the same time frame. Among 37% 0000000037

have ever used BNPL at merchants with Gen Z, 8% and 23% expect to pay with
which they held store cards. BNPL and a mix, respectively.

© 2022 PYMNTS.com All Rights Reserved

17 | The Truth About BNPL And Store Cards Report Key findings | 18

Overall, 12% of U.S. consumers plan Figure 6: Table 2:

to pay using a mix of BNPL and store Store card holders’ plans Store card holders’ plans
cards, and 4% intend to pay using BNPL to use store cards and to use store cards and
exclusively in the next three months.
BNPL in the future BNPL in the future
This means roughly 41 million consum-
ers in the U.S. want to pay via BNPL at Share of consumers who are highly likely Share of consumers who are highly likely to
the retail POS going forward. It is there- to use select payment methods in the next use select payment methods in the next three
three months months, by generation
fore clear that while consumers might
not always want to use BNPL options Just store cards
41% 0000000041

when store cards are available, adopting Generation Z Millennials Bridge millennials Generation X Baby boomers
Both and seniors
BNPL options can help retailers convert 12% 0000000012

millions more in sales than they would

Just BNPL Just store cards 42% 42% 45% 38% 42%
without BNPL plans. 4% 0000000004

Both 23% 21% 17% 9% 6%

Neither
44% 0000000044
Just BNPL 8% 6% 3% 3% 3%
Source: PYMNTS.com
Neither 28% 32% 35% 49% 49%

Source: PYMNTS.com

© 2022 PYMNTS.com All Rights Reserved

19 | The Truth About BNPL And Store Cards Report
Conclusion
Store cards and BNPL options are not
competing payment options but rather
complementary options that make a
natural pair at the retail POS. They
appeal to consumers of the same age
groups, income levels and financial life-
styles, some of whom plan to pay using
a combination of BNPL and store cards
in the future. This natural pairing stems
from the fact that these consumers are
chiefly interested in store cards and
BNPL options for different reasons and,
therefore, rarely use them to purchase
the same products. Merchants keen
on maximizing their sales should thus
incorporate both payment methods to
cater to customers’ specific purchas-
ing needs.
Methodology
The Truth About BNPL And
Store Cards Report draws
from a census-balanced sur-
vey of 2,161 U.S. consumers
about whether they owned
and for which purchases they
used store cards. Fifty-two
percent of respondents were
women, 32% held college
degrees and 36% of respon-
dents earned more than
$100,000 in annual income.
Thirty-four percent of respon-
dents were baby boomers
or seniors, 27% hailed from
Generation X and 28% were
millennials.
© 2022 PYMNTS.com All Rights Reserved
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