Buy Now Pay Later (BNPL) services like Afterpay, Zip and Klarna have become household names in Australia.

They have enjoyed explosive growth among younger consumers aged 25 to 34.

Prestige beauty brands have been major beneficiaries as an increasing number of young Australians forego credit cards.

The same success has been repeated in New Zealand, says IBISWorld, the global insight and analysis specialist.

Demand for BNPL services has skyrocketed during the COVID-19 pandemic in New Zealand as online sales have surged.

According to NZ Post, 11 per cent of all online shopping revenue was conducted through BNPL in 2019/20, with total spend rising 105 per cent.

Over 1200 Kiwi businesses have signed up for Afterpay alone. Other major players include PartPay, Laybuy, Oxipay and GenoaPay.

The number of consumers using BNPL rose 49 per cent in 2019, with particularly strong growth among younger consumers, says Yin Yeoh, IBISWorld senior industry analyst.

The e-commerce market in New Zealand is expected to reach NZ$5.3 billion over the next 12 months.

Fashion, accessories and lifestyle products such as prestige beauty have been among the big winners across the Tasman.

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