^{It’s Monday, I’m Nithya Sudhir. I collect words, chase patterns, and write about whatever makes me curious.}

70% of shoppers say payment options influence where they buy online. And one payment method has quietly become the most powerful nudge at checkout: Buy Now, Pay Later (BNPL).

BNPL was once used to finance big purchases.

Sofas. Flight tickets. The occasional emergency laptop.

But today, Gen Z is using it for skincare, fashion basics and even lunch.

And 65% of them are planning to use it more this year.

Which means, BNPL is now a default payment behaviour.

But recently, the FCA has initiated stronger protections for consumers in the UK from 15th July 2026 from BNPL.

What makes this payment option so appealing, why is it under scrutiny and how does it affect brands?

It’s Monday. Let’s find out.

70% of shoppers say payment options influence where they shop and BNPL is an acquisition lever. Nearly half of all BNPL users say they love it for its convenience and ease of use.

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BNPL nudges customers into narrow bracketing. So the purchase decision is made per installment rather than as a total commitment, which lowers perceived sacrifice at the moment of choice.

Spending money literally activates pain centers in the brain, a phenomenon known as the pain of paying. Spreading payments across time lowers emotional intensity and weakens the purchase–payment link.

This, coupled with the denomination effect, means people spend more easily in smaller units. Installments feel like subscriptions, utilities or coffee budgets.

As predictably irrational humans, we assume that future income will be higher, expenses will be lower and discipline will be stronger. It’s called optimism bias. So the third and fourth installments get approved by a very confident version of ourselves.

Additionally, the present bias (hyperbolic discounting, says that we tend to overweight immediate rewards and underweight future costs.

So, getting something now vs paying for it later feels like a much better deal than paying now vs getting something later. (Even if the total cost is exactly the same.)

Installments don’t reduce the price. They change what feels reachable.

When a $150 item becomes “$37.50 today”, premium SKUs feel attainable, bundles feel justifiable and the perceived downside of being wrong feels smaller. That matters most when a first-time buyer is deciding whether to trust an unfamiliar brand.

Mixtiles, a photo-tile company, had a simple question: would adding BNPL to checkout actually help, or would it just shift customers from paying by card to paying by installments?

It’s also worth noting: offering BNPL was found to improve brand perception, too.

This proves that payment flexibility isn’t just a conversion tactic, it’s a trust signal.

BNPL is even more essential in categories where product differentiation is low, pricing is competitive and switching costs are minimal. Here, the presence of “Pay in 4 installments” can quietly tip consideration into intent before product value is fully evaluated.

From 15th July, the UK’s Financial Conduct Authority is expected to bring Buy Now, Pay Later products under stronger consumer credit regulation.

Providers will now need to conduct affordability assessments and offer clearer repayment information. Customers will gain access to formal complaint routes and stronger protections under credit law.

For DTC brands, this may reshape how BNPL appears on-site.

The upside? Regulation often brings trust.

As BNPL moves from perk to policy, it may start to feel less experimental and more like a standard payment expectation. And in a market where shoppers increasingly choose where to buy based on how they can pay, that expectation is likely to matter.

As always, hit reply if something in here hits home.

See you next week,
Nithya

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