PayPal Sees Uptick in BNPL Spending for Black Friday

PayPal saw a much greater than usual use of buy now, pay later (BNPL) options on Black Friday, according to CEO Dan Schulman.

Speaking on CNBC’s “Mad Money” on Tuesday (Nov. 30), Schulman said PayPal’s installment pay service is “one of the stars” of the season.

Schulman said the BNPL pay volume was up almost 400% year over year last Friday (Nov. 26), and the company did around 750,000 transactions on Black Friday. Those numbers came as the company recorded its first-ever over-$1 billion payment volume in a single month.

BNPL has become increasingly popular among customers over the pandemic, due to the financial and economic environment of the time, and financial technology companies have adapted to the trend.

While there are several companies specializing in BNPL, PayPal’s offering was rolled out in late 2020, letting people pay for some purchases with an installment model over four payments. The company has also announced its plans to buy Japanese firm Paidy for $2.7 billion.

PYMNTS has reported on the wider BNPL trend, showing that the offering has been embraced this year at both brick-and-mortar stores and online shops.

Read more: Black Friday Retail Results Show Buy Now Pay Later Gaining Ground

BNPL is still a smaller slice of the payments landscape, with just single-digit percentage points of people saying they would be using it for Black Friday — around 5.6% used it this year in-store, which was an increase from 3.6% last year. Its online usage this year hit 8.9%, up from 3.7% in 2020.

In particular, Afterpay did seem to do well, though, seeing a 230% bump in spending in the last year. This holiday season, the platform has seen a 34% increase compared to a year ago, and the company says there’s been a 30% increase in the number of people using BNPL services.

PYMNTS notes that while BNPL is “gaining ground” in terms of the views people have of it, it will continue to develop as regulations evolve and providers adapt to any restrictions that come in the future.