Will Buy Now, Pay Later Replace Credit Cards?

Core Insights - Buy Now, Pay Later (BNPL) services have gained significant popularity, with many users considering phasing out credit cards in favor of BNPL options [1][5] - Despite the rise of BNPL, it is unlikely to completely replace credit cards due to the lack of rewards associated with BNPL services [2][8] Group 1: Popularity and Usage of BNPL - BNPL services have emerged as a popular financing option, making purchases more attainable for consumers [3] - Many BNPL platforms are integrated into shopping websites, enhancing the affordability perception during checkout [3] - A survey indicated that 38% of BNPL users plan to replace their credit cards with these services, and 56% prefer BNPL over credit cards [5] Group 2: Advantages of BNPL - Key reasons for choosing BNPL include ease of payment, flexible repayment options, straightforward approval processes, and minimal or no interest charges [6][7] - BNPL services provide an alternative for individuals with limited credit, allowing them to finance purchases without needing a credit card [7] Group 3: Limitations of BNPL - BNPL services do not offer rewards such as cash back or travel points, which are attractive features of credit cards [8] - The potential for interest charges on missed payments may deter some consumers from fully relying on BNPL [4]