Atlanta, GA—October 4—A new first party research study conducted in collaboration between Splitit and PYMNTS has provided strong evidence supporting the demand for card-linked installment plans. This insightful research confirms the broad appeal among shoppers from diverse demographic backgrounds when it comes to using their bank-issued credit cards for deferred payment options. The findings clearly contrast with the prevailing narrative promoted by Buy Now, Pay Later (BNPL) lenders who load up consumers with high fees and high interest rates while demonizing credit cards.
More than half of all Gen Z and Millennial shoppers intend to increase their use of installment plans for their holiday shopping, according to a new study by Splitit and PYMNTS Intelligence, Installment Plans Becoming a Key Part of Shoppers’ Toolkit. The first party survey also found that consumers across a broad spectrum of generations and income levels use interest-free installment plans. In fact, 64% of consumers earning more than $100,000 annually favor installment plans, challenging assumptions about credit usage and income. The study also found that nearly one-third of all shoppers would consider purchasing a higher priced item if they could pay for it using interest-free installments linked to their own existing credit card.
“As we move into the critical holiday shopping season, it’s imperative for retailers to pay as much attention to their checkout experience as they do to their merchandise selection,” said Nandan Sheth, Chief Executive Officer, Splitit. “Interestingly, our study showed that high-earners would utilize installments more if they were attached to their favorite bank issued credit card, without the need to apply for a new loan. Retailers will miss out on sales if they do not capitalize on the evolving consumer behavior to expand their market reach.”
Consumer sentiment now favors installment plans from traditional credit card issuers over those from legacy Buy Now, Pay Later (BNPL) providers or store-based programs. In the past year, 45% of consumers have chosen these plans compared to 37% for BNPL and store-issued installments. Furthermore, 42% of credit card installment plan users were high income earners. In fact, high-earning Millennial shoppers were found to be most likely to use credit card installment plans.
The study further revealed that nearly one-in-three shoppers would consider purchasing a higher priced item if they could pay for it in interest-free installments linked to their own existing credit card. Furthermore,
Other key findings include:
Splitit is a global payment solution provider that lets shoppers use the credit they’ve earned by breaking up purchases into monthly interest-free installments using their existing credit card. Splitit enables merchants to improve conversion rates and increase average order value by giving customers an easy and fast way to pay for purchases over time without originating new credit. Splitit serves many of Internet Retailer’s top 500 merchants and is accepted by more than 1,500 eCommerce merchants in over 30 countries and shoppers in over 100 countries. Headquartered in Atlanta, Splitit has an R&D centre in Israel and offices in London and Australia. The Company is listed on the Australian Securities Exchange (ASX) under ticker code SPT. The Company also trades on the US OTCQX under ticker codes SPTTY (ADRs) and STTTF (ordinary shares).
Installment Plans Becoming a Key Part of Shoppers’ Toolkits was produced in partnership with Splitit and PYMNTS Intelligence. It is based on a survey of 2,572 consumers, fielded from August 8 – 12, 2023. The sample was census-based with respect to the U.S. population, with 51% of respondents identifying as female and 34% holding a college degree. The average age was 47, and 39% earned more than $100,000 annually.
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