BNPL Enters the Mainstream as 18% of UK Adults Hold a Loan, TransUnion Finds
Buy now, pay later has moved decisively out of its niche and into the financial mainstream, according to new research published by TransUnion, which finds that 18% of UK adults currently hold a loan with a BNPL provider. The findings land on the eve of the sector coming under Financial Conduct Authority supervision on 15 July, and they suggest the product now being regulated is considerably broader, and older, than its reputation implies.
The credit reference agency's consumer survey punctures the assumption that BNPL is a Gen Z habit. Millennials, defined as those aged 30 to 45, report the highest lifetime usage at 45%, ahead of Gen Z at 39% and Gen X at 37%. Baby Boomers, at 15%, remain the clear outlier. On active borrowing, 27% of Millennials say they currently hold a BNPL loan, against 25% of Gen Z consumers, evidence that adoption now extends comfortably to consumers in their mid-40s.
More significant for banks is where the product now sits in the credit hierarchy. Asked to name their preferred form of short-term credit, 21% of consumers chose BNPL, second only to credit cards at 51%. Demand also looks durable rather than cyclical: roughly a third of both Millennials (34%) and Gen Z (32%) intend to take out a BNPL loan in the next 12 months. The research is drawn from TransUnion's Q1 2026 Consumer Pulse study, a survey of 1,000 UK adults conducted with Dynata in February.
From 15 July, the FCA brings deferred payment credit inside the regulatory perimeter. Lenders will be required to carry out proportionate affordability checks before advancing credit, provide clear information about agreements, and offer support to borrowers in financial difficulty. Consumers who enter agreements after that date will also gain access to the Financial Ombudsman Service. The FCA has confirmed the final rules, with firms able to trade under a temporary permissions regime while they apply for full authorisation. Agreements struck before Regulation Day remain unregulated.
Madhu Kejriwal, chief executive officer of TransUnion UK and Europe, said: "Widespread BNPL usage shows it has moved beyond the early adopters to become an increasingly embedded part of the credit landscape. While younger consumers were quick to lead the way, we're now seeing Millennials more consistently integrate BNPL into everyday financial management."
For lenders, the data reframes the compliance task. Affordability assessment on a product used by nearly one in five adults, across every age bracket, is a mainstream underwriting problem rather than a youth-lending edge case. It also sharpens the visibility question. TransUnion was the first UK credit reference agency to accept BNPL information into credit files, and the incentive for providers to share that data now grows considerably: any bank running an affordability check without sight of a customer's BNPL commitments is underwriting against an incomplete picture of their obligations.
