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Financial Innovation November 15, 2022

Holiday 2022: Gen Z is eyeing buy now, pay later for purchases​


With the holiday season upon us, let’s take a closer look at the buy now, pay later (BNPL) plans among the youngest group of shoppers.​

Bread Financial proprietary research reveals that 24% of Gen Zers (born 1997-2004) plan to leverage BNPL for holiday purchases, up from the 14% who used it for holiday 2021.* Compared to the Gen Z cohort at large, potential Gen Z BNPL users are significantly more likely to indicate that they’re seeking special financing terms specifically because they’re spending more on essentials like food and gas (39% versus 24%). Despite inflation’s  impact, this Gen Z subset doesn’t seem to be feeling ho-ho-hum about their approach to holiday shopping. Rather, potential Gen Z BNPL users are gearing up to be active, engaged shoppers over the holiday season.

Digitally minded​
While Gen Z is generally digitally savvy, this is even more evident among potential BNPL users, who are more likely to purchase for holiday via online outlets.​

Longer shopping lists​
Potential Gen Z BNPL users plan to purchase from a wider array of categories (average: 6.5) than Gen Z shoppers overall (4.9), perhaps also driving the need for the financing tool.

Options to pay​​
Compared to Gen Z at large, potential Gen Z BNPL users are also significantly more likely to lean into other financing tools (like credit) as well as rewards points.​

Bread Financial Image

Key takeaway: Making merry with Gen Z shoppers​
While Gen Z is still coming into its own in terms of spending power, understanding their payment needs now could be a building block for driving deeper engagement in the years to come. While the holiday shopping season is well underway, ensuring that BNPL offerings — as well as other financing tools, like retail credit cards — are clear and easy to use could be key to ringing up sales and unlocking additional spend with these young shoppers.

Source: Bread Financial, Holiday Look Ahead survey, September 2022

*Bread Financial, Holiday Hindsight survey, January 2022