Australia is a global leader in adoption of Buy Now, Pay Later solutions: Marqeta survey

Australian consumers are turning to Buy Now, Pay Later solutions in droves, making them a global leader in the adoption of BNPL when compared to the US and UK, according to a new survey by Marqeta (NASDAQ:MQ), the global modern card issuing platform. Now established in Australia, the company surveyed 1,000 Australian consumers to learn their attitudes toward credit products, such as credit cards and Buy Now, Pay Later solutions, and how they’re using them in today’s COVID-19 economy. Their behavior was compared to consumer attitudes in the US and UK.

Marqeta’s new survey shows that Australians are attracted to the ease and affordability of BNPL solutions, with their 0% interest rates on payments and flexibility being the main reasons for adoption. Since the pandemic began, BNPL use in Australia has boomed, with 72% of consumers surveyed saying they increased purchases using BNPL in the past 12 months. Interestingly, this increase was consistent across every age group and wasn’t confined to one generation driving the growth.

• 60% of Australian survey respondents said they have used a BNPL service, a rate exceeding US and UK respondents which were below 1 in 2 (47%)
• Almost one-third of local respondents said they started using BNPL solutions during COVID-19.
• A majority of local BNPL users said they plan to replace their credit card completely and revert to purchasing channels like BNPL for transactions (60% of users surveyed).

Marqeta’s survey shows how consumer attitudes toward their credit card providers could be a factor in Australian consumers’ search for new, more affordable options. While credit cards are still Australians’ number one form of credit, with 74% of respondents reporting using theirs regularly, 54% of Australians said they are turned off by credit cards’ high interest rates. According to the survey, 72% of consumers also said they have become more conscious of their credit card balance throughout COVID-19. The pandemic has forced Australians to pay more attention to their credit card bills and has led them to more flexible payment options. Almost a quarter of respondents said they have struggled more throughout COVID-19 to meet the minimum of their credit card payments and 60% said they have become more aware of budgeting over the past 12 months.

“We’re seeing a real shift in how consumers are wanting to pay in Australia, which is leading to a surge in Buy Now, Pay Later adoption. Not only are consumers going online more to make purchases during COVID-19, but they’re looking for the flexible payment options that Buy Now, Pay Later solutions provide,” said Duncan Currie, Marqeta Country Manager for Australia and New Zealand.

Marqeta’s survey shows Australian consumers want to see innovation in their credit options. Seventy-four percent said they’d be interested in a credit-like card product that charges your account right away, like a debit card, but helps to build your credit. In addition, 88% said they want the ability to personalize their rewards program, showing the growing need for modern and customized credit solutions.

“Australians are leading the charge when it comes to adopting new credit solutions, and credit card providers should take notice,” said Currie. “With 80% of consumers surveyed who use Buy Now, Pay Later solutions saying that they plan to continue to use them in the future, we expect financial services to continue to take notice of this shift in consumer behaviour and expect to see further innovation in the space.”

Read the full report here: www.marqeta.com/resources/resource/2021-state-of-credit