Buy Now, Pay Later Versus Credit Cards: What It Means for Younger Borrowers (and Your Practice)
With Gen Z and Millennials driving a $560B+ surge in Buy Now, Pay Later (BNPL) usage, bankruptcy attorneys are seeing new, complex debt patterns emerge.
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NextChapter Team
Published on Sep 23, 2025

The Rise of BNPL: A Quick Overview

“Buy Now, Pay Later” (BNPL) services like Affirm, Klarna, and Afterpay have exploded in popularity. In 2025, the global BNPL market is expected to reach $560 billion, growing at nearly 14% annually, according to Coinlaw.

In the U.S., Gen Z and Millennials are leading this shift—59% of Gen Z and 58% of Millennials reported using BNPL in 2025 (Coinlaw, MediaPost). In fact, a J.D. Power survey reported by Payments Dive found that during the holiday season, 54% of Gen Z used BNPL, compared to 50% who used credit cards.

Why Younger Generations Prefer BNPL

There are several reasons why younger borrowers are turning to BNPL:

  • Budgeting & accessibility: BNPL breaks down purchases into smaller installments, which feels more manageable than lump-sum credit card charges (MediaPost, Numerator).
  • Perceived credit impact: Many believe BNPL won’t affect their credit scores—though this is changing as credit agencies begin incorporating BNPL data (MarketWatch).
  • Cultural acceptance of debt: Analysts note that in today’s impulse-driven economy, younger consumers—facing stagnant wages and high living costs—see debt as a coping tool (Vox).

But There’s Risk: Debt, Delinquencies & Data Gaps

The growing reliance on BNPL isn’t without issues:

  • A survey found that 51% of Gen Z users have missed at least one BNPL payment, a much higher rate than older generations (Talk Business).
  • The Consumer Financial Protection Bureau (CFPB) reports that BNPL users carry much higher credit card utilization—averaging 60–66% compared to 34% among non-BNPL users.
  • Morgan Stanley warns that BNPL can obscure the true picture of a borrower’s debt load, and while delinquency rates may look lower today, underlying financial pressure is growing.

What This Means for Bankruptcy Attorneys

As BNPL becomes a default payment method for younger borrowers, attorneys are likely to see:

  • More clients whose BNPL usage worsens existing debt problems.
  • Complex financial profiles with stacked installment plans plus high credit card balances.
  • The need to adapt intake workflows to capture non-traditional debt sources.

Being able to recognize these patterns and incorporate them into client evaluations will become increasingly important.

How NextChapter Can Help You Respond

NextChapter makes it easy to connect with Gen Z and Millennial clients in the ways they actually prefer to communicate and share information:

  • NextMessage client texting: Younger clients expect quick, direct communication, not endless phone calls or emails. With NextMessage, you can securely text updates, appointment reminders, and document requests right from NextChapter. This keeps cases moving forward while meeting clients where they are—on their phones.
  • Modernized intake questionnaires: Digital-native clients don’t want to print, scan, or handwrite forms. NextChapter’s mobile-friendly, online intakes allow them to complete questionnaires anytime, anywhere, from their devices. This improves accuracy and creates a smoother start to their case.
  • Streamlined document uploads: Instead of chasing paper or waiting for email attachments, clients can snap a photo or upload directly from their BNPL apps, bank accounts, or credit card portals. This speeds up collection of critical financial data.
  • Clear financial snapshots: NextChapter automatically consolidates BNPL, credit cards, student loans, and other debts into one easy-to-read view. Attorneys can spot red flags faster and provide tailored guidance.

By adopting the same communication styles and tech-friendly processes that Gen Z and Millennials expect, attorneys can build trust quickly, reduce friction, and move cases along more efficiently.

Final Thoughts

The rapid growth of BNPL—especially among Gen Z and Millennials—shows how quickly consumer borrowing behavior is changing. Bankruptcy attorneys who understand these trends and adapt their processes will be best positioned to serve the next generation of clients.

➡️ Ready to modernize your intake and case prep? Sign up for free today and see how NextChapter makes it easy to manage even the most complex debt profiles.