Fueled in large part by the skyrocketing growth of buy now, pay later (BNPL) giant Klarna, the United Kingdom is expected to see its largest holiday shopping season to date as more than 17 million U.K. customers have used BNPL to make a purchase online, according to a Monday (Nov. 29) report from the BBC.
The news comes on the heels of a recent push for BNPL regulation, according to PYMNTS. The use of BNPL has grown nearly four-fold in 2020 to 2.7 billion pounds ($3.6 billion) according to data from the Financial Conduct Authority.
Concerned about managing debt stemming from the ease of making purchases and opting for installment payments, U.K. parliamentarian Stella Creasy earlier this month called on the government to enact legislation quickly.
U.K. organization Citizens Advice, which helps people with debt, housing and other matters, also called for BNPL regulation, according to PYMNTS.
Gary Rohloff, co-founder and managing director of BNPL company LayBuy, told PYMNTS in a recent interview that his company is on board with regulation. However, he pointed out that the company has already implemented consumer safeguards, including credit checking consumers and assigning an affordability score before issuing credit. In addition, if installment payments are not made, the account is suspended.
LayBuy launched its BNPL offering in the U.K. in 2019 with the ability to make payments in six interest-free installments.
BNPL company Klarna, which launched in the U.K. in 2014, has doubled its number of users to 15 million since early 2020.
Last week, Klarna announced its Pay Now option had been added to its suite of U.S. payment services, in addition to the impending debut of the Klarna Card in the U.S. market, according to PYMNTS. Within the past year, the company has nearly doubled its U.S. customers to more than 21 million.