Unwrapping the Impact of BNPL on UK Christmas Shopping

The festive season is synonymous with joy, celebrations, and, of course, the hustle and bustle of holiday shopping. This year, however, there's a new player in the Christmas shopping game that's altering the landscape – Buy Now, Pay Later (BNPL). According to the recent Equifax BNPL Barometer, the impact of BNPL on Christmas shopping in the UK is profound and far-reaching.

BNPL: A Lifeline for Christmas Shoppers

In a surprising revelation, Equifax research shows that almost half of UK adults (48%) have turned to BNPL to spread the cost of their purchases. It's becoming clear that for many Brits, BNPL is more than just a payment method – it's a lifeline that enables them to navigate the expenses of Christmas without breaking the bank.

Record Numbers and First-Time Users

The BNPL phenomenon has witnessed an astonishing surge, with 7.4 million more people opting for BNPL this year compared to the previous year. This surge signifies a shift in consumer behaviour, as millions of Brits embrace the convenience and flexibility offered by BNPL for the first time.

The Christmas Connection: BNPL's Seasonal Peak

Equifax's data unveils a clear seasonal pattern in BNPL usage, with average monthly payments peaking in December each year. Last year, payments reached £172, and with the continued growth in BNPL usage, a similar spike is expected this festive season. Nearly one in three consumers (32%) intend to use BNPL for Christmas, Black Friday, or Cyber Monday shopping, making it a pivotal tool for managing holiday expenses.

Age Demographics and Changing Trends

Traditionally dominated by younger demographics, BNPL usage is expanding across age groups. While 18 to 34 year-olds remain the biggest users, the 55+ age group has seen remarkable growth, with 13% utilising BNPL this year – a significant increase from 4% in 2021. Monthly repayments for the 55+ age group have also outpaced younger demographics, growing 12% year-on-year.

Cautionary Tales: Failed Payments and Consumer Spending Habits

With the increased adoption of BNPL comes a rise in failed payments, with 17% of consumers reporting missing a repayment. Alarmingly, almost half (46%) of 18 to 34 year-olds have failed to make a BNPL repayment on time. Additionally, over half (57%) of BNPL users tend to spend more when using the service, emphasising the need for caution and responsible spending.

Regulation in the Spotlight

Despite its widespread use, a surprising half (49%) of UK adults are unaware that BNPL is currently unregulated by the Financial Conduct Authority (FCA). The call for regulation has gained momentum, with the government expressing its intention to regulate BNPL in February 2021. The government has come under pressure from consumer groups and the Labour party to make regulation happen and we expect a government response shortly. 

Looking Ahead: The Future of BNPL

Over the last three years we've witnessed a surge in BNPL use by consumers, and the products have become an essential part of many people’s shopping experience. However, while consumers are using BNPL more and making bigger payments on BNPL, we’re seeing a slower growth this year, compared to last. It’ll be really interesting to see in the next year or so how BNPL trends respond to the changing economy.

As with any form of credit, when shoppers use BNPL, it can be a great budgeting tool, or way to spread spending out over the festive period. Shoppers should treat BNPL in the same way as other types of credit: make sure you can afford the repayments and educate yourself on the risks. Caution from both lenders and consumers needs to be taken to ensure repayments can be made. Equifax supports the call for regulation for BNPL, as not only will it protect consumers, but also help those with thin credit files to build up a healthy credit score.

But BNPL providers don’t need to wait for regulation - they can report credit data to Equifax today to protect their customers and help them build their credit file.


While providing a lifeline for many, the surge in BNPL usage prompts a call for caution, responsible spending, and for data to be included in credit files urgently. As we unwrap the gifts of the season, it's essential to recognise the impact of BNPL on the way we navigate the festive season's financial terrain.

The Equifax BNPL Barometer uses Open Banking data to help shed light on the evolving dynamics of consumer spending. If you'd like to know more about the ways we can help you use Open Banking to better understand your customers, download our latest brochure.


Sources: The information in this blog is based on the Equifax press release: 22 November 2023.