BNPL Is No Longer a Trend, It's a Global Shift

Buy Now, Pay Later is transforming how people finance purchases and how businesses structure payment offerings. With global transaction volumes accelerating across e-commerce and in-store channels, BNPL is moving from niche innovation to mainstream financial infrastructure.

According to a recent Market Outlook report, BNPL accounted for $316 billion in global e-commerce payments in 2023, making up over 5% of total e-commerce volume. That figure is expected to grow to $443 billion by 2027, fueled by expanding adoption in both developed and emerging markets.

Another report projects BNPL to reach $565 billion by 2026 and even $834 billion by 2028 in other models.

Who’s Using BNPL and Why?

Consumer adoption is being driven by younger, digital-first generations:

• According to a recent study 46% of Gen Z and 47% of Millennials in the U.S. used BNPL in the last 12 months.
• Another report shows that 64% of Gen Z and 75% of Millennials say their BNPL usage is increasing year over year.

Consumers cite reasons such as:

• Budget flexibility and improved cash flow
• Transparent and interest-free instalment options
• Frictionless checkout experiences, both online and offline

This has direct implications for merchants and issuers alike. BNPL transactions are proven to increase average order value, boost conversion rates, and reduce cart abandonment.

In emerging markets like Africa and Southeast Asia, BNPL is becoming a gateway to financial inclusion, offering alternative credit where formal lending channels are still underdeveloped.

BNPL Regulations Are Changing Fast, Here’s What You Need to Know

As Buy Now, Pay Later becomes more popular around the world, governments are stepping in to protect consumers and ensure responsible lending. The message is clear: BNPL is becoming a regulated financial product, not just a checkout option.

Asia

BNPL adoption in Asia is surging, and early regulatory frameworks are starting to emerge:

• In Singapore, BNPL providers must follow a voluntary Code of Conduct since 2023, including clear disclosures, credit limits, and customer due diligence
• Regulators have warned that stricter laws may follow if consumer risks rise.
• Other markets like Vietnam and Indonesia are expected to introduce BNPL-specific oversight as usage grows.

Africa

Africa’s BNPL space remains largely unregulated, but that’s beginning to change:

• In Kenya, a 2024 amendment gives the Central Bank authority over BNPL providers, focusing on licensing and consumer protection.
• The move follows concerns over opaque terms and aggressive debt collection practices in informal lending models.

United Kingdom

The UK government announced in May 2025 that BNPL providers will soon need to follow the same rules as traditional lenders. This means:

• Getting approval from the Financial Conduct Authority (FCA)
• Running proper credit checks before approving loans
• Making sure terms are clear and fair for customers
  New rules will be finalized by mid-2026.

European Union

The EU has passed new consumer credit legislation that will apply to BNPL as well. This includes:

• Standard rules across Europe for transparency, fees, and early repayments
• Stronger affordability checks before offering credit
• Banks and BNPL providers in the EU will need to comply by late 2026.

Australia

Australia’s government confirmed that BNPL will now fall under its Consumer Credit Code, meaning providers must:

• Apply for a lending license
• Prove that loans are affordable for each customer
• Be part of official complaint and dispute systems
• These rules will roll out between 2026 and 2027.

Why Financial Institutions Must Move Now

BNPL is not just a merchant-led play. Licensed financial institutions (banks, fintechs, processors) are uniquely positioned to deliver compliant, scalable, and personalized BNPL offerings that stand the test of both customer demand and regulatory oversight.

Strategic benefits include:

• Retaining relevance with Gen Z and Millennials
• Launching embedded credit products within apps, wallets, and e-commerce flows
• Driving fee-based and interest-based revenue through merchant partnerships or revolving models
• Enhancing customer lifetime value through flexible, data-driven repayment plans

However, many banks still operate on legacy payment systems that are too rigid to handle the real-time orchestration, credit scoring, and modular integration BNPL requires.

PowerCARD by HPS: Scalable BNPL Infrastructure, Built for Today’s Reality

At HPS, we’ve engineered PowerCARD to help banks, fintechs, and processors launch BNPL offerings quickly, while maintaining full control, compliance, and customer-centricity.

PowerCARD provides not just the technology to deploy BNPL, but the agility to continuously evolve your offering across markets and business models.

Ready to Build Your BNPL Strategy?

BNPL is no longer optional, it’s strategic. And for banks, processors, and fintechs with the ambition to lead, the time to act is now.

Contact our team to discover how PowerCARD can power your next-generation BNPL solution at sales@hps-worldwide.com