It has been a few weeks since the BNPL evangelists released yet more consumer research claiming that BNPL can displace credit cards, but predictably, here is another one.

Out today, a whitepaper from Divido entitled ‘Consumer sentiment report: How are shoppers using checkout finance in 2023’ reveals that “checkout finance is fast becoming one of the most trusted and popular forms of payments among consumers, and now rivals cash and credit cards. In fact, those aged 18–35 are slightly more inclined towards checkout finance than credit cards, with 62.8% saying they used checkout finance compared to 60% who use credit cards.”

This does not quite square with actual transactions taking place online and in the high street but no matter.

GlobalData UK consumer survey

The latest GlobalData consumer survey measuring what consumers are actually doing, as opposed to their inclinations, noted that some 85.2% of UK consumers had not used BNPL in-store. For online transactions, the number is only slightly lower, at 81.6%.

Todd Latham, CEO, Divido is a good bloke and I have no wish to rubbish all of his firm’s research. He can certainly claim that an extension in availability of checkout finance offers potential benefits for consumers, retailers and lenders during current economic uncertainty. And merchants should certainly, as he argues, pay close attention to consumer preferences for their products and services and look at how checkout finance can diversify their payment product portfolio.

The point remains however that BNPL spend remains a drop in the ocean relative to credit card expenditure.

Credit and charge cards accounted for 19.6% of total card payment value in 2022. The frequency of credit and charge card payments stood at 70.5 transactions per card per year as of 2022 according to GlobalData’s research. And despite the nonsensical claims from some that credit cards are being seriously challenged, our research suggests that credit and charge card payment frequency is set to increase at a healthy pace, rising to 82.6 transactions per card per year in 2026. Meantime, the BNPL sector cannot escape the funding challenge while interest rates remain at current levels. It remains a moot point as regards which BNPL outfits will survive that challenge.