Breaking Boundaries: India’s Buy Now Pay Later Phenomenon Sparks Credit Revolution- But Is it Sustainable?: Ken Research


The Buy Now Pay Later (BNPL) market in India has experienced an unprecedented surge, becoming a catalyst for the credit revolution in the country. With a staggering compound annual growth rate of ~321% between 2019 and 2021, the BNPL industry has witnessed remarkable growth. The sector is currently driven by factors such as increasing smartphone and internet penetration, coupled with unmet credit demands that were unfulfilled by the credit card players. However, amidst the skyrocketing growth, the sector faces certain challenges like the lack of government regulations and the rising number of BNPL fraudulent providers. Now this raises a question on the sustainability of the BNPL market. Here is Ken research observation on the landscape of the BNPL industry in India.

1. Buy Now Pay later Services (BNPL) are recognized as Proxy lending services by RBI: BNPL companies are proxies between lending partners and customers

2. In India, increasing smartphone and internet penetration, and credit demand unfulfilled by credit cards helped the BNPL players proliferate

2.1 Additionally, E-commerce and convenience offered by BNPL services are primary reasons for users to adopt Pay Later practices

3. Currently, no laws specific to BNPL lending are in place: RBI is considering measures and policies to regulate the BNPL market

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3.1 Also, the large number of fraudulent BNPL providers is a concern for the consumer that inhibits the growth of the industry: New regulations could change the scenario for BNPL companies

4. Still, the industry has a high potential to thrive exponentially owing to the Convenience of credit offered by BNPL players

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India Buy Now Pay Later Market