Money Wellness
Image of a calculator with a little Christmas tree on top
category iconcost of living
calendar icon28 Nov 2023

Millions of Brits would struggle to pay for Christmas without buy now pay later

One in three shoppers are set to use buy now, pay later to spread the cost of their Christmas shopping, according to the Equifax UK PNPL Barometer.

The data reveals it has been a bumper year for BNPL usage with 7.4 million more people using it this year compared to 2022. This means that almost half of all UK adults (48%) have used buy now, pay later to spread the cost of purchases at one time or another.

The amount people are spending using BNPL has also increased by almost half (46%) from £105 in 2021 to £153 this year. And Equifax said that there’s clear seasonal patterns with payments, with people spending more on BNPL in December - payments reached £172 last December - and another peak is expected during this festive period.

Nearly a third of people (30%) of Christmas BNPL users said that they’d struggle to afford Christmas without the help of BNPL, with is up from 27% in 2021.

While it’s 18-34 years who’re most likely to use BNPL, those aged between 35–55-year-olds are going to be relying on it the most to fund Christmas (34%).

The cost of living has driven the increased usage of BNPL, with shoppers looking to spread the cost of purchases. It’s being used the most to pay for fashion, interior items, white good and electronics. Perhaps most concerningly it’s also being frequently used to buy everyday consumables, such as the weekly food shop.

Alongside the increase used of BNPL, there has been an increase in failed payments, with 17% of people reporting missing a payment. Almost half (46%) of 18–34-year-olds have failed to make a BNPL repayment on time.

On top of monthly payments increasing, so has the number of monthly BNPL transactions people are making. Equifax data shows that, on average, the number of payments people make on BNPL increased from four and a half in 2021 to more than seven in recent months.

Craig Tebbutt, Chief Strategy & Innovation Office at Equifax UK, said: “As with any form of credit, when shoppers use BNPL, it can be a great budgeting tool, or way to spread spending over the festive period.

“Shoppers should treat BNPL in the same way as other types of credit: make sure you can afford the repayments and educate yourself on the risks. Caution from both lenders and consumers needs to be taken to ensure repayments can be made.”

BNPL is not currently regulated by the Financial Conduct Authority (FCA). The government announced its intention to regulate BNPL in February 2021 an earlier this month, Labour’s Shadow City Minister, Tulip Siddiq MP, wrote to the government calling for regulation urgently.

Tebbutt added: “Equifax supports the call for regulation for BNPL, as not only will it protect consumers, but it’ll also help those with thin credit files to build up a healthy credit score.”

Avatar of Caroline Chell

Caroline Chell

Caroline has worked in financial communications for more than 10 years, writing content on subjects such as pensions, mortgages, loans and credit cards, as well as stockbroking and investment advice.

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