As consumers get ready for the upcoming holiday season, many are keeping a watchful eye on how much they plan to spend. And while it’s often tough to not spend anything during this time of year, some consumers in the UK said they’re turning to buy now, pay later services as a way to not overstress about the gifts they purchase.
In fact, new data from Creditfix—which surveyed more than 2,000 adults in the UK on their upcoming holiday spending habits—found that nearly a quarter plan to use their credit cards or a BNPL service to help support their Christmas shopping. And overall, the research found that many consumers plan to cut back on spending.
Holiday Shopping, but Make it Budget-Friendly
More than two-thirds of consumers surveyed by Creditfix said they feel anxious about the upcoming season, particularly in terms of spending more than they can.
Many are taking necessary steps to not put themselves in any financial strain, including scaling back on the gifts they plan to purchase, in addition to looking for lower-priced deals. Roughly eight in 10 respondents said they’re going to be looking for cheaper brands or shops to purchase from this year.
And overall, 14% of respondents said they’ll be spending less on gifts for their friends and family, compared to years prior.
Buy Now, Regret Later?
Scaling back on purchases is often easier said than done. And in anticipation of this, more consumers said they’ll be turning to BNPL to help with their holiday shopping.
Although BNPL has grown in popularity over the years, it’s also caused many consumers to go into debt. That’s because the allure of the service—breaking down a large purchase into smaller installments—often givens consumer the illusion that they’re paying less than the full value of the product.
However, they’re essentially—and often—paying for a purchase that they can’t afford. Creditfix found that 20% of those surveyed said that it would take them roughly three months to pay off their bills for this coming holiday season. Even more alarming, some expect to continue paying off purchases well into the 2024 holiday season.