As grocery prices grew in 2023, consumers reached out to buy now, pay later (BNPL) services. The Washington Post noted that in the first two months of 2023, groceries’ share of BNPL orders grew 40%.

While inflation has been cooling, there are still lingering effects as overall prices are up 4% from last year, according to Supermarket News. The U.S. Department of Agriculture found that the average family spent about $973 in June this year at the supermarket, an increase of 3.5% year over year.

“The consumer is incredibly adept at finding ways to stretch their spending and, healthily or not, buy now, pay later has certainly provided that outlet,” said Simeon Siegel, an analyst with BMO Capital Markets.

Payment installment services are now a $309 billion industry with predictions that it will grow more than 25% by 2026. The Federal Reserve found in a survey that about 1 in 8 consumers have used the buy no, pay later services in the last 12 months. “Households earning $20,001 to 50,000 a year, women, and Black and Hispanic adults are more likely to use BNPL, according to surveys by the Consumer Financial Protection Bureau and the Federal Reserve,” reports the Post.

For most BNPL apps, e-commerce and online payments are the top modes of purchasing. But new contenders like Splitit, powered by Ingenico, can offer in-store payment options as well.

The Post reports: “U.S. households are holding a record $17 trillion in debt, including nearly $1 trillion in credit card debt, according to the New York Fed’s quarterly household debt and credit report.” NACS strongly supports the recently introduced Credit Card Competition Act. Read more here and here.