Today we announced the results of our first Buy Now Pay Later (BNPL) survey which polled more than 2000 U.S. adults on their experience with Buy Now Pay Later services offered via retail sites.
Buy Now Pay Later services have continued to see explosive growth across the retail vertical as the cost of living continues to rise. This practice allows consumers to make purchases and pay for them at a future date, however as this new payment ecosystem expands, so too does the threat of fraud across an unregulated landscape.
Nearly a third (31%) of those who experienced fraud now worry about paying for things online, but more strikingly, 23% no longer use any BNPL services and 18% no longer use the corresponding retail website.
Key findings include:
- 23% no longer use any Buy Now Pay Later services and 18% no longer use the retail website where they purchased the goods.
- 31% of those who experienced fraud now worry about paying for things online.
- 76% of those who use BNPL services believe their BNPL provider will protect their personal data
However, of those who use BNPL, one in seven have experienced fraud
- 45% of those who use multiple BNPL services use the same email and password for all their accounts.
- 55% of those surveyed believe that BNPL providers should be most responsible for protecting their customers against from fraud
‘BNPL provides a great opportunity for customers to gain additional time to pay-off purchases, but the numerous frauds we’re seeing hardly justifies the convenience,’ said Amir Nooriala, Chief Commercial Officer, Callsign. ‘As the latest manifestation of account takeover, consumers are at high risk of fraud when using BNPL, and businesses need to respond accordingly to maintain trust with their customers and keep their reputations intact.’
Almost half (48%) of US-based adults surveyed use Buy Now Pay Later services to make purchases, increasing to 61% in the 18– 34-year-old population. These are significant numbers when you consider that 1 in 7 of these individuals has been a victim of fraud, extrapolating to a staggering 22 million American adults.
The odds increase exponentially when factoring in those who leverage multiple BNPL services. Not only does the landscape for fraudsters broaden, but nearly half of all the respondents who use more than one BNPL service, use the same email and password for all their accounts which only makes the fraudsters’ jobs easier.
But despite the prevalence of fraud, more than three-quarters (76%) of consumers who use these services trust BNPL providers to protect their personal data and protect them from fraud (75%). On the other hand, of the general population that has not used BNPL, those figures drop to 53% and 51% respectively.
‘There is clearly an appetite for BNPL amongst the consumer population, but for there to be greater trust from consumers, businesses need to address the prevalence of fraud and take more extensive measures to protect their buyers,’ added Nooriala. ‘The majority of those surveyed (55%) indicated that they believe the BNPL provider is responsible for protecting them against fraud, closely followed by the retailer brand, and consumers will speak with their wallets.’