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Coronavirus: Gen Z turn to buy now pay later schemes to fund lockdown spending

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Young people are relying on Buy Now Pay Later schemes (BNPL) to cover their finances during lockdown as a result of COVID-19. 

New research from reveals that nearly a quarter of 18 to 24-year-olds are more likely to use BNPL to fund purchases since the government lockdown.

While only 16% of Generation Z said they had bought items using BNPL, of those who had, 64% said they had spent more than they normally would.

By contrast just 7% of the UK adult population made a BNPL purchase since lockdown began on 23 March.

The option to spread payments into smaller amounts appears to be more attractive to Generation Z than other age groups. Less than a third of those aged 18 to 24 agreed it was financially irresponsible for BNPL payment plans to be advertised at the current time compared with almost half of those aged 55 to 64.

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Nearly a fifth of shoppers had noticed more BNPL plans being offered to them when shopping online since the lockdown was imposed. This figure jumped to 33% among Generation Z.

The Financial Conduct Authority (FCA) recently announced a three-month interest payment freeze for individuals using BNPL schemes.

But concerns remain around how easy people find managing their debt and staying on top of payments once they have used these schemes.

John Crossley, head of money at, said: “Our research suggests that young people in particular may be turning to alternative credit schemes at a time of growing economic uncertainty. There remain serious concerns, however, over some people’s ability to keep track of their debt and prevent bills from racking up." 

He added: “The latest payment freeze announced by the FCA on BNPL purchases is welcome news for those struggling with keeping on top of current payments. Fees and interest terms differ between BNPL providers, but customers should be aware that interest on purchases will still accumulate during the payment freeze and will be payable after the three-month break."