Spending patterns and financial risks among 'Buy Now, Pay Later' (BNPL) consumers

Abstract

This study aimed to determine the spending patterns and financial risks among BNPL Consumers in Iloilo City using a survey-correlational research design. The participants were 214 BNPL consumers selected through convenience sampling. Descriptive statistics included frequency count, percentage, mean, and standard deviation, while inferential statistics utilized the Mann-Whitney U test, Kruskal Wallis H test, and Spearman’s Rho at a 0.05 significance level. Findings revealed that BNPL consumers exhibited frequent purchasing behavior, a high tendency to make unplanned purchases, and often prioritized purchasing essential items, while the purchase of non-essential items occurred occasionally. This indicates that while BNPL is widely used for both planned and impulsive needs, consumers may limit non-essential purchases due to budget constraints or fear of excessive debt. Furthermore, perceived financial risk in terms of debt accumulation was rate high, while concerns about late fees and penalties were moderate, and financial instability was also perceived as moderate. This implies that although consumers recognize the dangers of debt, their experiences with payment penalties and financial pressure vary. Spending patterns differed significantly in terms of frequency of purchase when classified by sex, with males reporting higher frequent spending. Significant differences also emerged in terms of unplanned purchases and purchase of non-essential items with single consumers showing high tendency and frequent buying behavior, respectively. Perceived financial risks significantly differed in terms of debt accumulation and financial instability when classified by civil status and educational attainment, with higher perceived risks reported by single individuals and high school graduates, respectively. Lastly, a significant relationship was found between consumer spending patterns and perceived financial risks.