Building on the momentum seen in the e-commerce space during the Covid-19 pandemic, the buy now/ pay later (BNPL) model is one of the fastest-growing segments in consumer finance, particularly in emerging markets. The global market is valued at an estimated $560bn in 2025, having achieved a compound annual growth rate (CAGR) of 21.7% between 2021-24. BNPL providers offer point-of-sale loans that consumers can repay in instalments over the course of weeks or months. Charging little to no interest, these microcredit providers make profit via transaction fees paid by the retailer, offering increased sales and customer conversion in return. Highlighting opportunities in the space, in June 2022 US tech giant Apple announced it would debut its own delayed payment service, entering a market dominated by start-ups such as Sweden’s Klarna and US-based Affirm. That same month PayPal announced its own service, Pay Monthly, which has grown to include Pay in 4. The services experienced a 20% year-on-year growth in the fourth quarter of 2025.
By 2024 BNPL grew to become the fifth most-used payment method in global e-commerce, after digital wallet, credit and debit cards, and account-to-account. It is set to account for 6% of all e-commerce payment transactions in 2026. With a global market value of $560bn in 2025, the segment is projected to exhibit a CAGR of 21.7% and reach $992bn by 2030. While inflation and weaker consumer spending have weighed on companies’ valuations, the BNPL sector is increasingly defined by regulatory oversight and consolidation. New frameworks in the UK, EU and Middle East are reshaping the competitive landscape, while larger players expand through partnerships and smaller organisations face pressure to merge or specialise.
Financial Inclusion
BNPL allows retailers to access markets where finance options are less available, and boosts the purchasing power of individuals and micro-, small and medium-sized enterprises (MSMEs). Because BNPL automates credit approvals, when integrated into online payments, checks are conducted without face-to-face interaction. BNPL is attractive for individuals without a robust credit history, often financing a shopper’s first online purchase. For customers, it lowers the debt risk associated with credit, while limiting the risk of non-payment or fraud through soft credit checks. The majority of BNPL’s growth has been in the business-to-consumer space, financing online purchases of goods that individuals might otherwise not be able to afford. Many start-ups, such as Egypt’s Valu, also offer point-of-sale loans for services such as health care, education and travel, as well as for conventional goods. BNPL accounts for some 60% of its gross merchandise value. Some start-ups target the business-to-business space by offering a line of credit for MSMEs to purchase from suppliers, granting them more purchasing power and access to credit.
Emerging Markets
The share of adults in emerging markets who made or received digital payments rose from 35% in 2014 to 57% in 2021 and 62% in 2024. Paying in instalments is well established in the financial culture of many countries, as are cash alternatives; in Brazil, consumers rely on bank slips known as boleto bancário in lieu of cash, while Mexican corner stores offer a voucher system for payments. BNPL firms in the MENA region have also attracted substantial investment in recent years. By 2025 Saudi Arabia’s Tamara had cemented its position as the Kingdom’s foremost BNPL provider, following its $340m Series C round in 2023 and continued expansion across the GCC. UAE-based Tabby, meanwhile, raised $700m in debt financing in late 2023 and surpassed 4m active users in 2025, making it one of the region’s fastest-growing financial technology companies. Regulatory momentum has accelerated: the Qatar Central Bank implemented its BNPL framework in 2024, requiring licensing and sharia-compliance oversight, while Saudi Arabia and the UAE have introduced stricter consumer protection rules to balance innovation with responsible lending.
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