- Rising grocery prices are driving more consumers to use Buy Now, Pay Later (BNPL) loans to afford food, with 25% of users reporting they’ve used the service for groceries — up from 14% the previous year.
- Gen Z is the leading demographic using BNPL for grocery purchases, with nearly half of them considering applying for loans to manage everyday expenses.
- Food-related purchases like groceries and delivery are increasingly financed through BNPL, with about one in six users also using the service to pay for takeout or food delivery.
As grocery prices continue to climb consumers are increasingly turning to “buy now, pay later” (BNPL) loans to manage everyday expenses. However, this growing reliance on BNPL services is not without its challenges. A new study conducted by LendingTree in April 2025 highlights issues such as missed payments and the complexity of juggling multiple loans at once.
The LendingTree study reveals that 64% of Gen Z Americans (ages 18 to 28) have used a BNPL loan and nearly 16% have done so at least six times. In contrast, only 29% of baby boomers (ages 61 to 79) have used these services. This stark generational difference underscores how young consumers are turning to alternative financial tools to cope with inflation and rising costs.
Here are some of the crucial takeaways from the survey:
25% of “buy now, pay later” loans are used to buy groceries
While “clothing, shoes, and accessories” remain the most common items bought using BNPL, the report reveals a notable shift in how these loans are being used. Technology devices, Home decor, furniture or appliances follow, with groceries now ranking as the fourth most purchased category using BNPL.
This year, 25% of consumers reported using BNPL loans to purchase groceries, a significant rise from 14% the previous year.
Gen Z consumers are leading this shift, with nearly half of the demographic considering applying for BNPL loans, and groceries being among the top categories for which they use these services.
In last year’s LendingTree survey, millennials were found to be the age group most likely to use BNPL for grocery purchases. However, Gen Z has now taken the lead, reflecting changing habits in response to financial pressures.
Late payments are becoming more common among “buy now, pay later” users
As BNPL usage grows, so do payment challenges. The LendingTree report found that 41% of users made at least one late payment in the past year — up from 34% the previous year.
When asked how confident they were in their ability to pay off a BNPL loan on time, 63% of respondents said they were “very confident,” while 30% said they were “somewhat confident.” Despite these self-reported levels of assurance, the rise in missed payments suggests many users may be overestimating their ability to manage these loans effectively.
Many users rely on multiple loans at once
Another troubling trend highlighted by the study is the prevalence of managing multiple loans simultaneously. Nearly 71% of Gen Z “buy now, pay later” users reported having more than one active loan at the same time. Among them, 26% said they had juggled at least three loans at a time.
Importantly, not all of these loans are used for discretionary spending. In fact, 33% of BNPL users see the loans as “a bridge to their next paycheck” — a sign that many are using these services to cover essential living expenses rather than optional purchases.
Courtesy of LendingTree
“Buy now, pay later” lenders are a growing presence in food deliveries
The study also examined which BNPL platforms consumers are using most frequently. PayPal leads the list, with 56% of users choosing it as their BNPL lender, according to the survey. Klarna, Affirm, and Afterpay are also widely used, each cited by 38% of users.
Reflecting evolving consumer habits, Klarna recently announced a partnership with DoorDash. This new arrangement allows consumers to pay for food deliveries using BNPL — a timely move, as the survey found that about one in six BNPL users have used the service to pay for food delivery or restaurant takeout.
Some consumers regret using loan services
Despite its convenience, many consumers are experiencing buyer’s remorse after using BNPL loans. Nearly 48% of respondents said that they’ve regretted a BNPL-financed purchase at some point. Gen Z, once again, stood out — with nearly 64% of the users expressing regret.
Returning an item bought through BNPL can be more challenging than traditional purchases. Often, consumers are required to first pay off the loan in full before processing a return, adding another layer of frustration to an already strained financial situation.
