PayPal saw the use of its buy now, pay later (BNPL) solution “Buy in 4” surge five-fold during the Black Friday weekend.
“We saw a 400% year-on-year rise on our volumes going through ‘buy now, pay later’ this past Black Friday,” PayPal CEO Dan Schulman said.
“It’s booming right now.”
Overall, 9 million PayPal customers used the company’s flexible payment offering.
The uptick in use of the company’s solution comes at a time when consumers are increasingly choosing to shop online and are valuing the payment convenience offered by BNPL plans.
“We had more than 1 million first-time users for the first time ever in the month of November,” Schulman said.
“It’s not just popular but accelerating in popularity.”
While the growth in popularity of BNPL services has been a boon for both service providers and merchants, it has also drawn fire from regulators, who argue that such services are leading to higher indebtedness, particularly among younger shoppers.
According to a September survey, a third of U.S. shoppers who used BNPL services were behind one or more payments.
PayPal, however, argues that its size and understanding of its customer base puts it in a position where it can better judge the creditworthiness of its BNPL users.
“We have 400 million-plus people on our platform. We know consumers and we know merchants and we know when someone can responsibly borrow,” Schulman said.
“We have one of the highest approval rates and one of the lowest default rates in the industry.”