Rising Use of BNPL for Groceries May Push Prices Higher, Study Finds
Research indicates that the growing reliance on buy-now-pay-later apps for grocery shopping could lead retailers to increase prices to offset transaction fees.
Economists at Washington University in St. Louis examined the impact of buy-now-pay-later financing on grocery retailing and discovered that roughly one-in-three Americans have used such apps for food purchases. A LendingTree survey revealed 29% of respondents rely on BNPL for groceries, nearly double the figure from two years prior. The researchers modeled how merchants absorb the fee charged by providers like Klarna, Affirm and Afterpay, finding that retailers typically pass the cost onto consumers by raising prices.
Since grocery margins are already narrow, the added expense could prompt stores to reduce stock or discontinue certain products. The study also highlighted concerns about “phantom debt,” with many users holding multiple small BNPL loans and a notable share missing payments. While average debt is modest, the trend signals broader financial strain for both shoppers and retailers.
