Dive Brief:

• More than half (55%) of U.S. consumers have used, or considered using, buy now, pay later payment options in the past, according to results of a PayPal Holdings survey of 2,005 adults released Wednesday.
• Among consumers who’ve used, or considered BNPL payments, three-quarters expect to use these options during their holiday shopping this year, the digital payments provider said. That’s partly because 59% of consumers said they value BNPL payments as a way to stretch and control their holiday budget, the PayPal survey fielded last month found.
• About four in ten (42%) survey respondents said they would be more likely to make a purchase when BNPL options are offered.

Dive Insight:

PayPal’s survey results suggest consumers sometimes turn to a BNPL option because it gives them a "feeling" of more control over their budget for holiday spending, the release said. 

About six in 10 (58%) of survey respondents said they’re more concerned than last year about finances ahead of this holiday season. Despite that anxiety, 64% of holiday shoppers anticipate spending the same or more than they did in 2025.

“What's changing isn't consumers’ desire to spend during the holidays, but how they’re going about it,” PayPal’s president of checkout solutions, Frank Keller, said in the release. “Shoppers are starting earlier and taking a more intentional approach, looking for deals, rewards and cash back to make every purchase count.”

PayPal is among the companies that provides consumers with options to make payments in installments. On that front, it competes with Klarna Group, as well as Affirm Holdings and Block’s Afterpay. BNPL entered the payments market about a decade ago with pitches for free financing, but over time many of the providers have added interest-bearing options to their offerings.

PayPal’s findings show an increased appetite for BNPL payments compared to the 2025 holiday season. Last year, the payment giant found that half of 1,000 U.S. respondents surveyed expected to use BNPL providers to pay for their holiday expenses. Shoppers who planned to use BNPL services did so because they wanted to spread the cost of purchases over time and take advantage of BNPL promotions, the release said.

While PayPal continues to track the consumers considering BNPL services, one of its competitors analyzed its internal data after the 2025 holiday season to see how well its customers fared. In January, Block’s BNPL unit Afterpay said 96% of its customers who financed their Black Friday and Cyber Monday purchases with BNPL installments had repaid the debt on time or early.