BNPL Expected to Stretch Holiday Shoppers’ Budgets and Boost Holiday Spending

Consumer spending is expected to remain resilient this holiday shopping season and buy now, pay later loans will play a key role in the trend, according to Cash App Afterpay’s 2025 Holiday Survey.

Despite 38% of consumers in the United States saying they feel more financially stressed than in 2024, and 35% worried about their ability to pay for their holiday gift purchases, 25% of respondents plan to spend $1,000 or more this holiday season, up from 18% in 2024, the survey says. Another 20% of respondents say they expect to spend $500–$1,000 this season.

Cash App, Block Inc.’s P2P payment app, surveyed 2,200 adults in the U.S. ages 18–65 and 264 retail business development managers in July. Afterpay is Cash App’s BNPL offering and is available within the Cash App wallet.

BNPL is expected to help consumers manage their holiday shopping budgets by providing them with financing accessible at the point-of-sale. Some 21% of respondents say they are more likely to shop with a retailer that offers BNPL, while 20% say they are more likely to complete a purchase when BNPL is available. The top reasons why consumers say they use BNPL are convenience (65%), reliability (59%), and better budget management (39%).

From a merchant perspective, 88% of retail business decision-makers offering BNPL say it’s an important tool for attracting new customers and increasing sales. Afterpay transaction data during the 2024 holiday shopping season supports those trends. During the 2024 holiday shopping season, Afterpay users generated $5.1 billion in sales, while Afterpay merchants saw a 33% lift in spending during the period, compared to the 2023 holiday shopping season.

To help manage their holiday shopping budgets, 41% of respondents say they plan to start their shopping earlier to “lock in their big-ticket and high-demand items first,” the survey says.

Among early shoppers, 48% say they plan to complete most of their holiday shopping by October. Overall, 43% of early bird shoppers say they start early to spread out their holiday shopping costs. The high percentage of early bird shoppers does not mean holiday sales will see a significant drop off in the following months. “Deal-driven buyers will still bring a strong November–December rush,” with one in three shoppers saying they will hold off on their holiday shopping until November, the survey says.

Among bargain hunters, 44% say they will wait for major sales events to trigger their holiday purchasing, while 27% say they expect to take advantage of discounts of 50% or more, especially on electronics and apparel, when shopping this holiday season.