Why US Shoppers Are Turning to BNPL for Groceries — and What the Surge Signals

Why Americans Are Using BNPL for Groceries

Buy now, pay later has moved from fashion checkouts into the grocery aisle. Federal Reserve estimates cited in a CNBC report show U.S. lenders originated nearly $157 billion in BNPL credit in 2025, up from roughly $116 billion in 2024, and a growing share of that lending is tied to daily necessities rather than discretionary purchases.

LendingTree survey data in the same report found 29% of American BNPL users have used the loans to buy groceries, more than double the 14% recorded in 2024. About 44% of surveyed consumers said they expected to take out a BNPL loan within six months, and 13% planned to take out three or more. Delinquency is also climbing: 47% of BNPL borrowers say they have paid late on a loan in the past year, versus 34% two years earlier.

The shift is happening against a backdrop of stretched household balance sheets. U.S. credit card debt reached $1.25 trillion in the first quarter of 2026, up 5.9% year over year, per Federal Reserve Bank of New York data. CNBC’s reporting attributes much of the squeeze to inflation and higher gas prices stemming from the U.S. war with Iran, and it profiles borrowers such as Ashley Reed, a paraeducator and part-time radiology assistant who turned to installment plans after medical costs maxed out her credit cards.

Whether this reflects consumer distress or simple adoption of a useful payment tool is the central question for retailers, lenders and regulators. The available data suggests it is both — and the balance between those two readings determines whether BNPL’s next chapter is growth or tighter regulation.

Stress Signal or Payment Evolution? The Data Behind the BNPL Surge

The surge is real, but so is the shift in credit mix

The headline number — $157 billion in 2025 originations, up about 35% from $116 billion in 2024 — shows BNPL has become a mainstream consumer credit channel. The more telling shift is composition: interest-bearing BNPL loans made up about 37% of issuances this year, nearly double their share in 2021, according to the report. That is the difference between a convenience product and a credit product. A four-installment, zero-interest plan can genuinely help a household smooth cash flow; an interest-bearing installment loan with fees up to 36% behaves more like traditional high-cost credit.

Grocery lending changes the risk profile

Using BNPL for groceries is not the same as financing a television. Groceries are recurring and perishable, and a household that borrows to cover them is usually borrowing because monthly income no longer matches monthly outgoings. The doubling of grocery use from 14% to 29% of BNPL customers is a stronger distress signal than the overall growth rate. It also matters for lenders: a loan tied to an ongoing essential expense does not improve the borrower’s ability to repay next month.

The payday loan comparison is becoming harder to dismiss

Protect Borrowers executive director Mike Pierce argues that late fees of $7–8 per missed payment, stacked on top of interest and financing charges reaching 36%, can turn a small BNPL loan into the equivalent of a 100% APR payday loan. With 47% of BNPL borrowers having paid late in the past year, that scenario is not hypothetical. Industry representatives, including American Fintech Council CEO Phil Goldfeder and Financial Technology Association spokesperson Miranda Margowsky, defend the product as transparent, flexible and, in its zero-interest form, smart money management. Both positions can be true: the industry’s defense describes the product’s best case, while the delinquency data describes how many borrowers actually experience it.

Retailers and regulators face separate decisions

For grocers and other essential retailers, adding BNPL at checkout may lift basket size and conversion, but it also introduces a form of consumer credit to a customer base that is demonstrably cash-strained. For policymakers, the convergence of rising interest-bearing issuance, grocery use and delinquency gives consumer-protection arguments more evidentiary weight. The direction of BNPL terms — toward consumers or lenders — will likely be set by how regulators respond to that evidence, not by marketing claims.

What BNPL Borrowers Should Check Before Their Next Installment Plan

For households weighing a BNPL plan for groceries or other essentials, the data points to a few practical checks:

• Confirm whether the offer is a zero-interest, four-payment plan or an interest-bearing installment loan. Interest-bearing plans made up about 37% of 2025 originations, and total interest and financing fees can reach 36%, per Protect Borrowers.
• Budget for the full repayment schedule before checkout. With 47% of BNPL borrowers paying late in the past year, missed payments are common — and each late payment can add $7–8 in fees on top of the plan’s stated interest.
• Track due dates across every open plan. The 13% of consumers planning three or more BNPL loans in the next six months are especially exposed to stacking late fees on multiple small balances.
• Treat BNPL as a short-term cash-flow tool, not a way to fund recurring essentials. The borrowers profiled as struggling used it after other credit was exhausted — raising the cost of the same groceries month after month.