Buy Now, Pay Later Consumer Credit Behaviour: Impacts on Financing Decisions

Buy Now, Pay Later (BNPL) services have emerged as a rapidly growing FinTech innovation, reshaping consumer credit behaviour and short-term financing decisions, particularly among young and digitally active populations. While BNPL offers convenience, interest-free instalments, and improved liquidity management, concerns regarding hidden debt accumulation, impulsive spending, and financial vulnerability remain largely unexplored in emerging markets. This study examines the impact of BNPL usage on consumer financing decisions, spending behaviour, and financial attitudes in India. Primary data were collected through a structured questionnaire from 92 respondents, predominantly within the 21–35 age group. The study employs descriptive analysis and Likert scale behavioural assessment to evaluate BNPL adoption, financial literacy, and attitudes toward debt. Findings indicate that BNPL is primarily used as a liquidity-management tool rather than for discretionary luxury spending. However, gaps in financial literacy and the preference for loans over depleting savings highlight the risk of debt stacking and long-term financial stress. The study concludes that while BNPL enhances short-term financial flexibility, regulatory oversight and financial education are essential to mitigate systemic and consumer-level risks.