Buy now, pay later can be a useful way to spread out a planned purchase without paying interest. Use it repeatedly for groceries, however, and several small payments can turn into a rolling balance that is difficult to clear.
According to LendingTree’s 2026 Buy Now, Pay Later Report, 29% of BNPL users have financed groceries, more than double the share from two years earlier. The same survey found that 47% had paid late during the previous year.
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When BNPL works
The familiar pay-in-four plan divides a purchase into four equal installments, usually collected every two weeks at 0% interest.
That can work well for a one-time expense when every payment fits comfortably within your budget. BNPL is helping with timing rather than making an unaffordable purchase appear affordable.
Why groceries may not work
Groceries are consumed long before a six-week payment plan ends. If you finance another grocery trip the following week, the new installments begin before the old ones are finished.
After several weeks, payments from multiple shopping trips overlap. You may still be paying for last month’s food while borrowing for this week’s basket.
If you miss one installment, making the next payment on time is not enough. You must pay both the overdue installment and the new one or risk ending up in a debt spiral.
BNPL can reach ‘100% APR’
A missed payment may also trigger a late fee. The Consumer Financial Protection Bureau found that the average BNPL late fee charged by providers was $9.99 in 2023.
A $10 fee on a missed $50 installment adds 20% to the amount due. Because the loan lasts only a few weeks, converting that fee to an annual rate yields an equivalent APR of more than 100%, Mike Pierce, executive director at Protect Borrowers, told CNBC.
Late fees on BNPL purchase are extremely expensive compared with the small amount borrowed and the short repayment period. Carrying the same $50 on a typical credit card for a few weeks would generally cost far less.
If you are paying interest on outstanding credit card debt, getting a new 0% intro APR credit card (until 2027) could help ease the pressure while you pay down your balances.
Keep the payments from piling up
Before opening another plan, add up every BNPL withdrawal scheduled before your next two paychecks. Look at the combined total, not only the small payment displayed at checkout.
Be especially cautious about financing groceries, rent, utilities and other recurring expenses. If this week’s necessities must be financed before last week’s are paid off, BNPL is covering an ongoing budget shortage rather than managing cash flow.
Buy now, pay later can be useful for an occasional purchase. When it becomes a weekly habit, tomorrow’s paycheck can end up covering yesterday’s groceries. Careful budgeting can help prevent that cycle from turning into a debt spiral that is hard to escape.
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