vizmaya desk · 25 October 2026
Buy now pay later: users with the least savings hit overdraft fees most
Volume keeps growing at 36% a year. The Fed's new survey shows where the cost lands when a payment bounces.
Four payments. One question: what happens if the account is short on pay day?
The short version
Four numbers tell the story
Sales paid for through Affirm in the year to June 2026.
Affirm annual report (10-K)
Growth in Affirm's sales volume, quarter to June 2026 against a year before.
Affirm, 27 Aug 2026
US adults who used BNPL in 2025. It was 10% in 2021.
Federal Reserve SHED 2025
BNPL users with under $100 saved who paid an overdraft fee because of it. At $2,000 or more: 4%.
Federal Reserve SHED 2025
First, the idea
A loan at the checkout: get it now, pay in pieces
Buy now pay later (BNPL) lets you take the thing home today. A lender pays the shop at once. You pay the lender back in smaller payments.
A common plan is four equal payments, two weeks apart.
Example amounts are ours. Plan shape: Richmond Fed Economic Brief 25-03, Jan 2025.
Where the lender's money comes from
The shop pays the lender, too
FactMost of the money comes from fees the shop pays, says the Richmond Fed. Some comes from interest and late fees.
In the quarter to June 2026, Affirm earned about 8.3 cents of revenue per $1 of sales. Klarna, a Swedish company , earned about 2.8 cents.
Our readingAffirm earns more because more of its loans charge interest.
Revenue divided by sales volume, our calculation. Affirm 10-K and 27 Aug release; Klarna Q2 2026.
The shape
Affirm's sales volume keeps growing about 36% a year
Affirm handled $14.1B of sales in the quarter to June 30, 2026. That is 36% more than a year before.
It expects more than $64B in the year to June 2027.
* Worked out from reported growth rates; each year sums to the 10-K total. Affirm 10-K, shareholder letters.
The split
Most of Affirm's lending is longer loans, not four easy payments
Many people picture four small payments. At Affirm, 70% of sales volume in the year to June 2026 was longer loans that charge interest.
Across all US lenders, the Fed estimates "pay in 4" was about half of the roughly $160B lent in 2025.
Affirm 10-K; Fed FEDS Note, 5 Jun 2026.
United States
More US adults use it every year
In the Fed's survey, 10% of adults used BNPL in 2021. By 2025 it was 16%.
The survey is called SHED, the Survey of Household Economics and Decisionmaking. The Fed runs it each year.
Federal Reserve, SHED 2025, Aug 2026.
Who uses it
The less savings people have, the more they use it
The Fed asked people for the biggest surprise bill they could pay from savings today.
Among people who could pay under $100, 31% used BNPL in the past year. Among those who could pay $2,000 or more, 8% did.
Federal Reserve, SHED 2025. Share of all adults.
The main finding
The less savings, the more overdraft fees it triggers
FactAn overdraft fee is what a bank charges when a payment pulls out more money than the account holds.
18% of BNPL users with under $100 saved paid one because of a BNPL payment. With $2,000 or more, 4%. Across all users, 11%.
Federal Reserve, SHED 2025. Among BNPL users.
What people buy
Groceries bring the most fees: 43%
Of BNPL users who bought groceries or food delivery with it, 43% paid a late fee or an overdraft fee.
Across all uses the share was 21%. For electronics it was 20%.
Federal Reserve, SHED 2025. Among BNPL users.
The lender's side
The lender's late loans edged up too
A loan is delinquent when it is 30 or more days late. Affirm's rate was 2.5% in the quarter to June 2026, against 2.3% a year before.
The Dec, Mar and Jun quarters ran above the year before. Money set aside for bad loans grew 40% in the Dec quarter, against 36% growth in sales.
The lens: who pays
Who pays? The shopper's bank goes first
Our readingAffirm says it never charges late fees. So when a payment bounces, the fee goes to the bank. That is our reading of two facts, not a sourced statement.
1. The shopper's bank account
18% of BNPL users with under $100 saved paid an overdraft fee because of it, against 4% of users with $2,000 or more.
2. The lender
Affirm's money set aside for bad loans grew 40% in the Dec quarter, while its sales grew 36%.
3. The shop
It pays a fee on each sale, often higher than a card fee, says the Richmond Fed.
Fed SHED 2025; Affirm FQ2'26 letter; Richmond Fed brief, Jan 2025.
Risks and counter-case
What could prove this wrong
Credit looks fine at Klarna
Klarna set aside 0.52% of sales for bad loans in the June quarter, down from 0.56% a year earlier. Affirm's recent monthly loans are on track for about 3.5% eventual losses, as it expected.
The overdraft may have happened anyway
The Fed counts overdrafts that a BNPL payment triggered. An account that thin could overdraw on a card payment too.
ContestedThe 47% "paid late" figure
A LendingTree survey says 47% of users paid late in the past year. Fed data point to about one in four. We do not use 47% as a rate.
Klarna Q2 2026 release; Affirm FQ3'26 letter; Fed SHED via William Blair and a 2025 SHED preprint; LendingTree.
What changed this week, and the weeks before
What changed in the last 90 days
- Aug 18
Klarna reports
Sales volume $36.6B, up 18%. It cut its 2026 forecast to $149B to $151B, from above $155B.
- Aug 20
Fed posts survey data
The Fed's page with 2025 BNPL use, overdraft and fee figures was updated.
- Aug 27
Affirm reports
Sales volume $14.1B, up 36%. It forecasts more than $64B next year. Its CEO links demand to high gas prices.
- Sep 14
New York comment deadline
Comments were due on the state's proposed BNPL rules.
- Oct 1
The $160B headline
AP reports Americans used BNPL for about $160B in 2025. The Fed note behind it is dated 5 June.
- Oct 14
LendingTree survey
Says 47% of users paid late in the past year. Contested, see the earlier slide on risks.
Klarna Q2 release; Fed SHED page; Affirm release; Hudson Cook note on NY DFS; AP via WBTV; LendingTree.
What to watch next
What to watch next
Affirm's next report
Its own forecast for sales volume: $13.7B to $14.0B. Watch whether loans 30+ days late stay at or below 2.5%.
Klarna's Q3 report
Its forecast: $35B to $36B of sales. Watch whether money set aside for bad loans stays near 0.52% of sales.
Gas prices and groceries
Our guessIf high gas prices last, more shoppers may put groceries on BNPL, and the fee share may rise.
Affirm 27 Aug 2026 results; Klarna 18 Aug 2026 results. New York's final rule had not appeared in what we found.
vizmaya desk · 25 October 2026
Sources and claims log
Sources
- Federal Reserve: SHED 2025 figures on BNPL
- Federal Reserve: BNPL beyond "pay in 4" (FEDS Note)
- Richmond Fed: BNPL market impact and policy
- Affirm FY2026 annual report (10-K)
- Affirm FQ2'26 and FQ3'26 shareholder letters
- Affirm release, 27 Aug 2026
- Klarna Q2 2026 release
- Hudson Cook: New York BNPL rule
- AP via WBTV; LendingTree
- More from us: vizmaya stories
Claims log
30 claims checked. Every number here comes from a verified one, apart from the 47% figure, which is marked contested.
Not found: a CFPB action in the window, Affirm's own FQ4 letter text, Klarna's delinquency level. No photos yet: see the note in the file.
FactOur readingOur guessmark which is which.