How Does Buy Now, Pay Later Impact Shopping Behavior?

Consumer Insights & Research | 4 mins

We’re always keeping our eye on how shoppers are using buy now, pay later financing. As the current ecommerce paradigm continues to evolve, we’ve seen the use of pay-over-time ramp up across verticals.

To learn more, we surveyed over 600 shoppers in the United States this past September to figure out how their buying behavior has changed during the pandemic. Our research shows that having a pay-over-time option has a demonstrable effect on shoppers’ loyalty and willingness to make a repeat purchase.

Our findings show that a buy now, pay later option encourages repeat purchases and larger average order values, while also having a major effect on businesses’ bottom lines in the form of fewer returned products.

Shoppers even prefer paying over time to buying with a discount—for many, the chance to use interest-free financing is more valuable than even 10% off their total purchase price.

Here’s what we learned:

How shopping purchase behavior would change with a pay-over-time option

Financing Can Increase Cart Size

51.3% of shoppers say they would make larger purchases from the same retailer if the retailer offered a buy now, pay later option.

Based on a survey conducted in 2018, one out of every three dollars of monthly discretionary income is spent online, but for a retailer to gain a larger share of that spend, you need to offer an intuitive payment experience. The chance to finance their purchase means shoppers can buy everything they need at once. This way they don’t have to worry about covering the full cost upfront or adding to their credit card balance. With financing, it’s easier for customers to afford everything they want to buy, even if it’s a larger purchase than usual.

Financing Can Encourage Repeat Purchases

41.9% of shoppers surveyed said they would be more likely to make a repeat purchase from a retailer that offered a pay-over-time option.

30% of consumers say they would rather buy from a website they’ve bought from previously than from an unfamiliar store. When financing is something a shopper prioritizes, and if they find the experience is easy and fast, they are even more likely to buy from a retailer where they’ve used the solution before. Once a shopper is approved with Bread, their credentials are saved so repeat financed purchases are even easier.

Financing Can Decrease Returns

40.3% of shoppers said they would be less likely to return a product if they bought it using financing.

60% of consumers have returned an online purchase, with 38% having returned up to 10% of all online purchases they have made. Anything you can do to decrease returns only improves ROI, and pay-over-time options can be an essential tool towards accomplishing this. A financing option can have a massive impact on your customers’ behavior, and have major effects on your bottom line.

Financing Can Be More Effective Than a Discount

51.9% of shoppers would prefer to pay for a $1,000+ purchase with interest-free installments than receive a 10% discount.

We’ve seen from our previous research that 85% of shoppers are interested in their favorite retailers offering interest-free installment payments. Offering pay-over-time installments is more than just a nice-to-have for a subset of customers, it can actively attract shoppers in lieu of discounts. We also learned from our most recent survey that 51.1% of shoppers also said they would prefer to pay in installments for a purchase of $1,000 or more versus putting it on their credit card—clearly there is an unmet demand for pay-over-time options.

How shoppers would prefer to pay for a purchase over $1000


A point-of-sale financing solution provides a faster and more convenient checkout and payment experience, makes your offerings more affordable, and encourages shoppers to make larger, repeat purchases. The fast-evolving world of ecommerce requires a reimagining of what shoppers want, especially during these unusual times. The ecommerce brands that will succeed in the months and years to come are already doing just that—and a buy now, pay later option is just the start.