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Generation Y and Generation Z are the biggest users of buy now, pay later, according to J.D. Power’s annual BNPL satisfaction study.
Some 42% of both generations use BNPL products, compared to 21% of consumers from other generations, the study says. Both generations tend to favor BNPL over credit cards for purchases largely because of what they view as more favorable repayment terms.
J.D. Power, which received responses from 4,343 customers earlier this year, defines Gen Y as those born between 1977 and 1994, and Gen Z as those born between 1995 and 2007.
“Generations Y and Z are attracted to buy now, pay later services primarily due to competitive repayment terms,” Sean Gelles, senior director of banking and payments at J.D. Power, says by email. “This is the second most common reason they cite for using BNPL, right after the desire to defer payment on a purchase.”
By comparison, the reasons cited by Gen Y and Gen Z respondents for favoring BNPL loans are not among the Top 10 reasons given by consumers who prefer to use credit cards for paying by card, Gelles adds.
Gen Yers have the highest overall satisfaction with their BNPL lenders, with a score of 627 out of 1,000, compared to other generations. In selecting a BNPL provider, Gen Yers cite such factors as convenience, cost, a recommendation from a family member, and trust with the brand.
Gen Xers, those born between 1965 and 1976, had the second-highest level of satisfaction with BNPL lenders, with a score of 620, even though just 29% of respondents in that generation say they use BNPL. Gen Zers rank third with a satisfaction rating of 617.
Card-based BNPL products with legacy brands continue to rate highly. Plan It By American Express, posted the highest satisfaction rating with a score of 706, followed by Chase at 675 and Citi Flex Pay at 663. Klarna is the highest-ranked non-card-based BNPL lender, finishing fourth with a satisfaction score of 638.
Card-based installment plans received significantly higher overall satisfaction ratings compared to other BNPL providers due to consumers’ greater familiarity and trust with their brands, Gelles says. “However, we predict that this advantage may diminish as consumers become more familiar and trusting of newer fintech brands,” he adds.
The two brands that saw the largest decline in satisfaction year-over-year are Zip and PayPal. The two brands saw a 30-point and 35-point drop in satisfaction, respectively, from J.D. Power’s 2024 BNPL study. The lower satisfaction ratings for these two brands contributed to a 13-point decline in the study’s overall rating. Zip ranked fifth, at 625, while PayPal came in sixth at 621.
The declines for Zip and PayPal are attributable to a significant increase in the number of their customers struggling to pay their bills during the period the study was conducted, compared to the same period a year ago, according to Gelles. J.D. Power conducted the 2025 study in January and February.
“[Zip and PayPal] were the only brands to see a significant year-over-year increase in [the struggle to pay bills] in the study. There is a strong correlation between this struggle and overall satisfaction,” Gelles adds.
