Articlegreen2023

Understanding the psychological determinants of buy-now-pay-later (BNPL) in the UK: a user perspective

Ruffin Relja · Philippa Ward · Anita Lifen Zhao

75 citations0/0 files storedInternational Journal of Bank Marketing

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Financial Literacy, Pension, Retirement Analysis Consumer Behavior and Marketing Influence FinTech, Crowdfunding, Digital Finance

Abstract

Purpose This study explores the psychological determinants of buy-now-pay-later (BNPL) use in the UK and reviews the efficacy of existing payment constructs. Design/methodology/approach A total of 533 BNPL users engaged in story stem completion. Template analysis was used, supported by the identification of four BNPL sentiment groups to enable comparison. Findings Whilst positive attitudes towards BNPL dominate, other psychological determinants are apparent to a varied extent. Psychological distance and ownership of borrowed money are redolent, while transparency and transaction convenience are less appreciable. BNPL users understand temporality beyond its current conceptualizations. Some users construe BNPL as a “savings” product, and hence payment format conceptualizations may be erroneous. Those with a positive sentiment foreground BNPL’s consumption and budget management benefits. However, the potential for unintended consequences is manifest across all users. Research limitations/implications The potentially unwanted consequences, or dark side, of BNPL use in the UK are highlighted. The specified constructs, whilst helpful, do not particularize the complex interconnected nature of the psychological determinants of BNPL use. Improved conceptualization offering richness and clarity is needed – temporality specifically requires consideration. Practical implications Users’ sophistication and misunderstanding are both evident, necessitating fuller conversations among various stakeholders, including, providers, policymakers, consumers and advocacy groups. Originality/value This research advances the scarce literature exploring consumers’ BNPL use determinants and challenges current conceptualizations surrounding payment format perceptions.

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References

2010Construal-level theory of psychological distance.1998The Red and the Black: Mental Accounting of Savings and Debt 2012Doing Template Analysis 2015Enjoyment and social influence: predicting mobile payment adoption 1998Payment Depreciation: the Behavioral Effects of Temporally Separating Payments From Consumption 2003The Effect of Payment Transparency on Consumption: Quasi-Experiments from the Field 2019The effect of credit card versus mobile payment on convenience and consumers’ willingness to pay 2012Do Payment Mechanisms Change the Way Consumers Perceive Products?

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