Digital Native. Two words that describe two evolving generations – Millenilals and Generation Z – who see the world from a fresh prism. Digital Natives were born at the end of the 20th century or the beginning of the 21st century. These indigenous residents of the digital realm started interacting with technology from a young age and don’t know life without tools such as the Internet, smartphones and social media.

Fact: digital natives are early adopters of Buy Now, Pay Later (BNPL) with an affinity and openness to BNPL fintech options. A significant proportion of BNPL users are under the age of 35. These ‘tech-savvy’ consumers tend to be cautious of traditional credit cards, with Gen Z’s usage of store credit cards at 27%, compared to 48% for baby boomers. BNPL provides an alternative to them, enabling shoppers in this space to augment their purchasing power by dividing payments over several months without incurring interest.

The younger demographic has articulated a preference for payment methods that do not increase their sense of indebtedness but rather instill confidence in their ability to afford their purchases. Consequently, 24% of Gen Z shoppers have reported using BNPL to circumvent revolving debt, in contrast to only 9% of Gen X shoppers. The dominant perspective among younger consumers is that BNPL financing does not constitute credit. They perceive themselves as engaging in prudent financial management by opting for alternative payment solutions.

Younger consumers prefer immediate transactions and the ability to choose without conditions. BNPL companies like PayLater, in Qatar, offer a monthly installment model that is free of interest.

For merchants, this digital behaviour highlights how BNPL can increase incremental sales, particularly in impulse-purchase product categories. It also raises customer touchpoints and upselling opportunities while allowing for improved targeting of Gen Z and millennial audiences.