Bread Financial Expands BNPL Offering

With consumers increasingly turning to installment payments for their holiday shopping, financial services firm Bread Financial has made its buy now, pay later (BNPL) offering available for Versatile Credit merchants and their customers.

“For the first time, these customers will now have access to BNPL financing at the point of sale — both online and in-store — giving them more financial choice and flexibility at checkout,” the company said in a news release Monday (Nov. 28.). “Customers can pre-qualify for Bread Pay in a matter of seconds, immediately apply the financing to their purchase, and pay for their purchase in equal installments over time.”

The launch of Bread Pay comes as around 40% of U.S. consumers living paycheck to paycheck report they plan to use financing tools such as BNPL to purchase holiday gifts this year, according to “New Reality Check: The Paycheck-to-Paycheck Report: Holiday Shopping Edition,” a PYMNTS and LendingClub collaboration.

Our research found that almost four in 10 Americans said they will finance the holidays, a move that will put more pressure on already tight consumer credit.

And our research after Black Friday found that in-store BNPL use rose 41% year over year among Black Friday shoppers this year, while online BNPL purchases were up 10%.

“With inflation eating paychecks at historic rates, consumers who did shop turned to financing in droves,” we wrote Monday.

Our data showed that almost one-third of shoppers used credit cards, point-of-sale loans or installment plans to pay for their Black Friday purchases last week. Those who turned to these options “used them to finance at least half of their Black Friday purchases. This shows how drastically soaring prices have impacted consumers’ shopping experiences,” our report found.

That one-third figure includes 45% of paycheck-to-paycheck consumers, who relied heavily on credit and financing to obtain Black Friday deals, paying for nearly 60% of their purchases using these methods.