The Buy-Now, Pay-Later Revolution: Groceries and the New Reality of Consumer Finance

The rise of buy-now, pay-later (BNPL) services has transformed consumer finance, but its latest frontier—groceries—reveals a stark truth: economic pressures are reshaping how Americans pay for essentials. A 2025 survey by LendingTree found that 25% of BNPL users now apply these services to groceries, a dramatic leap from 14% in 2024 and 21% in 2023, underscoring a shift from discretionary spending to everyday needs. This trend, driven by inflation, stagnant wages, and high interest rates, poses both opportunities and risks for investors in the BNPL ecosystem.

The Data Behind the Shift

The LendingTree survey, polling 2,000 U.S. consumers, highlights the urgency behind BNPL’s expansion into groceries. With food costs up 24% from 2020 to 2024 (per the Bureau of Labor Statistics), households are turning to BNPL to stretch budgets. Among BNPL users, 60% hold multiple loans simultaneously, and 25% juggle three or more at once, raising red flags about debt management. Yet the convenience of splitting grocery bills into interest-free installments—coupled with partnerships between BNPL providers and retailers—is propelling adoption.

Globally, the trend is even more pronounced. eMarketer’s 2025 U.S. report notes that 40% of consumers use BNPL for groceries, with millennials and Gen Z leading the charge (55% of 18–34-year-olds vs. 22% of those 55+). Meanwhile, Statista’s 2025 Australia data reveals 55% of shoppers using BNPL for groceries, though 40% of frequent users report difficulty managing payments—a warning sign for financial stability.

Investor Implications: Growth vs. Risk

For investors, the BNPL-grocery nexus offers two compelling angles: scaling adoption and regulatory risks.

1. Growth Opportunities:
2. Retail Partnerships: Grocers like Walmart and Target are integrating BNPL at checkout, boosting transaction volumes.
3. Demographic Tailwinds: Younger demographics, which prioritize flexibility over credit cards, will drive long-term demand.

4. Global Expansion: Statista’s Australia data and Global Market Insights’ EU projections (60% adoption by 看不出 2025) suggest untapped markets.

5. Risks to Monitor:

6. Debt Management: The 41% of BNPL users who missed payments (up from 34% in 2024) signal potential defaults.
7. Regulatory Scrutiny: As BNPL encroaches on essentials, policymakers may impose caps on interest-free periods or loan limits.
8. Margin Pressures: Rising costs for grocers could erode BNPL providers’ fee-based revenue models.

The Bottom Line

The 25% grocery BNPL adoption rate marks a structural shift in consumer finance—a response to eroded purchasing power and a preference for short-term liquidity. For investors, the sector’s compound annual growth rate (CAGR) of 20–25% (per industry estimates) remains alluring, but success hinges on balancing growth with risk mitigation.

Focus on firms with strong retailer networks (e.g., Affirm’s Walmart partnership) and data-driven underwriting to manage credit risks. Avoid overexposure to providers with high default rates or limited geographic diversification.

The grocery BNPL boom is here to stay, but its longevity depends on whether providers can sustainably navigate the fine line between financial inclusion and overindebtedness. For now, the data suggests investors should allocate cautiously, prioritizing companies that marry scale with fiscal discipline—and keep a close eye on the Fed’s next rate move.

In the end, the grocery cart is no longer just a basket of goods—it’s a mirror reflecting the fragile state of modern consumer economics.