The banking giant will build out its buy now, pay later footprint by creating two key roles within its Marcus direct bank—and its ambitions could add prospects for its upcoming checking account.

More than 45 million people ages 14 and older in the US will use buy now, pay later (BNPL) services this year, according to our inaugural user forecast for these financing options. That’s up 81.2% over 2020, and the age range of BNPL users will widen over the coming years as well.

The payfac model has catapulted into the mainstream, thanks to payments disruptors like PayPal, Square, and Stripe. The growth in the number of payfacs, and in the payment volume passing through them, is reshaping key relationships within the payments ecosystem. But the model bears some drawbacks for the diverse swath of companies adopting it, as well as for the merchants that work with them.

Afterpay and Klarna affirm their dominance

The buy now, pay later firm saw record-breaking volume driven by significant US growth and is positioning itself to keep up this momentum through international expansion and new retail partnerships.

For some time now, consumers have been moving toward demanding more frictionless payment methods across online and offline channels. The social distancing and sanitizing practices brought on by the pandemic proved to be the push that encouraged many consumers to try proximity mobile payments (paying for goods using a mobile phone as a physical POS) for the first time. Ecommerce retailers, not to be outdone, are finding ways to improve their transactions as well.

Buy now, pay later (BNPL) services have emerged in recent years as more retailers, including Walmart and Macy’s, began offering consumers financing options when checking out.

After the coronavirus pandemic forced issuers to adapt rewards, enhance forbearance, and build out digital tools to cope with a volume hit in 2020, they’re looking to reimagine their offerings in the future to add new customers and regain primary card status.

Why retailers may want to double-check customers’ debit cards

Buy now, pay later solutions are quickly gaining adoption as consumers look for new financing options and merchants aim to drive sales. But the industry is still unsettled as a number of firms are battling to lead the space, while card networks and issuers are looking to get involved too.

The retail industry is transforming at both physical stores and in digital. This report examines 10 trends that will most shape retail in the year ahead.