By Melissa Daniels  •  December 15, 2025  •

Ivy Liu

It was also the brands and fintech companies that pushed the services front and center.

This holiday season, more brands deployed BNPL services with different payment options beyond the more familiar “pay-in-four” structure, whether a six-month payment plan at 0% interest or a 24-month installment loan with interest. And the services are showing up in more digital wallets. Apple Pay users, for instance, can now toggle a payment plan with Affirm and Klarna, while Afterpay has new integrations with its sister company Cash App. 

Brands are also doing more marketing campaigns around their BNPL offerings, advertising 0% interest, six-month installments or special deals, like Sephora offering 25% off for Klarna or Afterpay users.

Tanuj Parikh, head of commercial for Cash App and Afterpay, said BNPL services have become more common across all sectors as the space has matured. They’re also more often positioned at the start of the purchase journey, rather than just as a checkout button.

“Retailers have gotten a lot smarter, where payments shouldn’t just be a bottom-of-the-funnel thing,” he said. “Doing site takeovers and having full ‘surround-sound’ marketing across that journey are the things that work really well.”

Afterpay wouldn’t share how many more retailers are in its network compared to 2024, or data on how specific campaigns performed. But new merchants who joined ahead of the holidays include some higher-end apparel and accessories brands like Thursday Boot Company, Tecovas, Diesel and Jenni Kayne. Parikh said the company is also furthering its push into wellness services, travel and ticketing.

“We’ve had a really deliberate focus on expanding our merchant network beyond our original strengths in fashion and retail, and you see a lot of that flow through,” Parikh said.

The United States has roughly 53.6 million unique BNPL users, according to new Consumer Financial Protection Bureau data released Wednesday. That’s a 12% increase from 2022. Users are each making around 6.3 transactions annually, with an average total dollar amount of $845 each.

BNPL represented about 7.3% of all spending from Nov. 1 to Dec. 2 this year, according to Adobe, and it’s forecasted to account for around $20.2 billion between Nov. 1 and the end of the year.

Parikh said the services tend to resonate most with Gen-Z and millennial customers, who are more cautious about using credit cards due to potential fees and interest charges. “People want liquidity regardless of what they’re purchasing. So whether that’s a shirt or whether that’s a ticket for a game, it really resonates.”

The types of payment structures offered to customers also played a bigger role in driving holiday traffic. At Afterpay, Parikh said the company did more co-funded marketing initiatives with its brands around 0% interest initiatives that proved attractive.

“You just get more time. You’re not paying any sort of interest on it. And so it’s a really great customer acquisition tool for partners,” he said.

Similarly, data from BNPL service Affirm showed 0% interest products grew 77% year-over-year during BFCM weekend. Plans that spread out payments across six months grew 232% YoY. 

SplitIt, a fintech company that offers installment payments for existing credit lines, also advertised more of its plans this year, said CEO Nandan Sheth. Ads that included financing plans generated an average of two and a half times the typical engagement rates across the portfolio.

Some brands and retailers that use SplitIt A/B tested their ads and, Sheth said, most saw higher activity around a 0% interest offer than with a typical discount. Across the SplitIt portfolio, promoting 0% buy-now, pay-later plans to new customers led to a 93% increase in conversions compared with a flat money-off offer.

Sheth said SplitIt also saw strong results from a pilot program where the service is embedded in Samsung Wallet. The partnership is live in around 30 states and, though exact data is not public, Sheth said it drove volume even without any marketing efforts, which are anticipated to start next year.

“We didn’t assume we’d see that level of growth without the marketing push or without offers, but consumers were just selecting it,” he said.

Overall, Sheth said he was surprised by how much transaction value the company is seeing this holiday season, given the overall macroeconomic environment. “We saw an incredible amount of growth, and our average ticket is a lot lower than we expected — and frankly, that scares me a little bit,” he said. “Why are consumers putting a $250 item or a sushi dinner on installments? We learned a lot from that.”

Afterpay’s Parikh said he sees further promotional opportunities between brands and payment services, such as tying in with loyalty programs to give extra benefits for Afterpay transactions. But he also pointed to the importance of Afterpay’s underwriting process to ensure that transactions are manageable even as the company continues to scale.

“We are really, really laser focused on it to make sure that those numbers stay healthy and we’re continuing to do right by consumers,” he said. “We want to make sure this is a healthy and responsible operator for customers, even in a stressed climate.”