Brits look to spread cost of purchases this holiday season

One in five UK consumers will spread the cost of Christmas to help better manage their finances, with food being the number one thing they plan on doing this for. 

That’s according to research from buy now, pay later specialist Butter.

The FinTech venture surveyed 4,944 people. 54% said that spreading the cost of Christmas shopping allows them to better manage their finances, stomaching the increased spend while also avoiding a bleak, long January.

A further 40% do so to indulge during the festive season by increasing the quality or quantity of their purchases.

When it comes to the area where consumers are most likely to spread the cost, clothing was second after food with tech, home goods and entertainment also ranking high. 

Timothy Davis, Co-Founder and CEO, Butter, comments: “The older we get, the more we realise Christmas is about spending time with friends and family but for many, it can still be a very costly time of year”

“Overstretching financially can leave us facing a very long January and so it’s hardly surprising that in this day and age, lots of us opt to spread the cost rather than absorb it all during the month of December.”

He adds: “However, pressures around delivering the perfect Christmas can still see some of us overspend and so it’s vital that you sit down prior to your festive shopping spree and work out exactly what you can afford and how you are going to cover the cost further down the line.”

“Knee-jerk purchases can often result in additional charges when using credit cards or other forms of advanced credit and that’s the last thing you want to wake up to come the 1st January.”

“The BNPL sector can help in this respect. Not only can you spread the cost of purchases interest free, but you have far greater control and visibility over your repayment time frame.”

Trouble ahead?

There has been increasing political and regulatory scrutiny of buy now, pay later companies in recent times, based around concerns that they tempt consumers to purchase goods they cannot afford.

As a result, big hitters like Klarna have been on something of a charm offensive, whilst also taking aim at traditional banks and credit card companies.

Earlier this year, for instance, it launched a UK campaign titled #WhyPayInterest. 

Running across OOH, online, on social media and in print, this aimed to highlight the difference between BNPL products and traditional credit cards, challenging what Klarna called “outdated business models and products that don’t serve consumers’ best interests”. 

Buy now pay laterStaff WriterButter, Christmas 2021, Payments, Buy now pay later, FinTech, Klarna, Holiday shoppingComment