For younger shoppers, buy now, pay later is not just a way to split a purchase. It is often a factor in where they choose to spend in the first place.
That’s among the sharpest findings in “Financing the Decision: How BNPL and Installments Reshape Merchant Choice,” the latest PYMNTS Intelligence Pay Later Ecosystem Report. Drawing on a survey of 2,763 U.S. consumers, the report finds BNPL carries the most weight when shoppers are comparing similar merchants and have room to deliberate. The effect is most pronounced among millennials and Gen Z, who are significantly more likely than older consumers to say financing availability shapes their decision on where to buy.
- 62% of millennials say BNPL influences their choice of merchant for travel, compared with 37% of consumers overall and 5% of baby boomers. Gen Z is not far behind at 49%.
- In food delivery, 43% of Gen Z and 44% of millennials say BNPL influences where they shop, versus 10% of baby boomers and seniors.
- In healthcare, 55% of Gen Z say merchant-offered installment plans influence where they seek medical or dental care. According to the report, no other generation comes close.
The deeper point is that younger consumers are treating financing as part of the shopping experience, not as an afterthought.
The responses show that BNPL has the most sway in categories where people can compare providers, such as travel, events, home services and food delivery. In those situations, financing can help one merchant stand out from another offering a similar product or service.
That gives retailers and service providers a practical opening. Clear payment options at checkout can help them win business from younger buyers who are already inclined to use these tools.
The report also suggests that younger consumers are broadening where they use financing. For Gen Z, the influence of installment plans extends beyond discretionary spending and into medical and dental care, where 55% say financing availability affects provider choice.
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The findings depict this as a distinct generational pattern, with younger adults approaching healthcare costs much as they do other major purchases by looking at both the service and the payment options attached to it. That points to a larger shift in consumer expectations. For a growing share of younger adults, flexible payment tools are becoming part of the standard package.
Other data points reinforce that BNPL’s influence is concentrated in groups already using pay-later products. Fourteen percent of consumers used BNPL in the last three months, and among those users the effect on merchant choice is far stronger than it is for non-users.
The report says non-users are largely unmoved, while existing users often let financing shape choices in the same categories where they already rely on it. That dynamic may be good news for merchants targeting younger consumers. It suggests that once shoppers become comfortable using these products, financing can help build repeat business and stronger loyalty over time.
At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.
