Research by Roy Morgan has found over 1.5 million Australians are now utilising ‘buy-now-pay-later’ to fund their purchases. Millennials and Gen Z are the heaviest adopters of the service.
In the twelve months to January 2019, 1.59 million Australians opted to take advantage of buy-now-pay-later services. Millennials make up the lion’s share of users, accounting for 40.6 per cent of the transactions on the various payment platforms. Gen Z follows close behind with 35.1 per cent of transactions. These two groups make up for over 75 per cent of the buy-now-pay-later market.
In contrast, older generations such as baby boomers and pre-boomers account for only 83,000 users (5.2 per cent).
Currently, only 7.7 per cent of Australians use ‘buy-now-pay-latter’ systems but as this has developed over a relatively short time period it leaves a great deal of growth potential among all generations.
Of the buy-now-pay-later options, Afterpay has the most recognition amongst consumers ahead of Zip Pay and Zip Money.
Norman Morris, Industry Communications Director, Roy Morgan, said the payment environment in Australia is facing rapid change.
“The increasing use of new payment technologies is being aided by the growing proliferation and development of smartphones and wearables with integrated technology such as Apple Pay and Google Pay, and an increasing number of financial institutions enabling their customers to make payments with these devices.
“Consumers will come to expect the minimum effort when making payments and the industry will need to adapt to these changing expectations by providing more innovative and simpler solutions. Traditional financial institutions may need to collaborate with Fintechs and other third parties to keep up with the rapidly changing digital payment environment,” Morris concluded.
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