What influences demand for Buy Now, Pay Later credit?

Tao Chen, Ben R. Marshall, Nhut H. Nguyen and Nuttawat Visaltanachoti

Economics Letters, 2024, vol. 242, issue C

Abstract: We investigate the determinants of demand for Buy Now, Pay Later (BNPL) credit using a comprehensive database from New Zealand. We consider both absolute demand and relative to total personal lending demand. The results indicate that BNPL is more popular with single individuals, younger people, and those on lower incomes. There is a negative relation between absolute and relative BNPL demand and interest rates. BNPL demand was reduced during the period around responsible lending legislation changes, even though these were not specifically related to BNPL, while demand increased following the end of COVID-19 lockdowns.

Keywords: Buy Now; Pay Later; Personal lending (search for similar items in EconPapers)
JEL-codes: G2 G20 G21 G23 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:242:y:2024:i:c:s0165176524003410

DOI: 10.1016/j.econlet.2024.111857

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