BOSTON— Consumers are increasingly splitting their purchases into predictable, fixed payments, reshaping the landscape of consumer credit as private label store cards and general-purpose credit cards expand installment options once dominated by buy now, pay later (BNPL) providers, according to a new report.
A new PYMNTS Intelligence report, based on 8,250 U.S. consumer surveys conducted between March and May 2025, shows that private label card installment use is growing far faster than traditional credit card installments — though from a smaller base. PYMNTS reported that store card installments rose 4.8% annually since 2023, reaching 30.3 million adult users this spring. General-purpose card installments inched up just 0.8% per year, used by 47.8 million consumers.
According to PYMNTS, the trend is reshaping competition between banks, card issuers, and BNPL firms such as Affirm, Klarna and Afterpay. As the company noted, BNPL exploded from $2 billion in purchases in 2019 to $175 billion in 2025, used by more than 40 million consumers, but it said credit card installments are now outpacing BNPL in specific categories such as travel, vacations, concerts and groceries, which was once a “BNPL stronghold.”
Role of Middle-Income Households
The PYMNTS data reveal middle-income households earning $50,000 to $100,000 boosted use of store card installments by 10% over two years.
It further found:
- Gen Z consumers increased usage nearly 20%
- Boomers also showed double-digit gains
- Millennials grew slightly
- Gen X fell. “Overall, one in seven Gen Z and millennial consumers reported using either credit card or store card installments in the past three months,” PYMNTS said.
The Appeal of Accessibility
PYMNTS said its analysis found part of the appeal is accessibility.
“Store cards, often easier to obtain and frequently paired with 0% financing or loyalty perks, are popular with younger shoppers who may lack long credit histories,” PYMNTS said. “For retailers, they drive repeat business on big-ticket items such as furniture or appliances.
Meanwhile, banks and card issuers are adapting.”
PYMNTS further reported that to defend market share, many now offer installment plans similar to BNPL, such as “Pay in 3” or “Pay in 4” options, either at checkout or retroactively on past purchases.
These often carry no interest if paid on time, undercutting BNPL’s original edge, the company said.
The research also found consumers’ motivations differ by method.
Increasing Overlap
According to PYMNTS, the overlap among payment methods is increasing. Nearly 22 million consumers used both private label and general-purpose cards for installments this spring, a faster growth rate than using either card type alone. BNPL remains the fastest-growing Pay Later option overall, but installments on store and credit cards are steadily gaining traction.
The full report can be found here
