Rising Reliance on Buy Now, Pay Later Loans for Groceries Signals Economic Strain

For many American shoppers, buy now, pay later loans have expanded beyond big purchases like electronics and travel, now covering essential items such as groceries.

In early April, Tia Hodge visited her local Kroger and filled her cart with 71 items, resulting in a bill close to $400. At checkout, she used the Klarna app, a buy now, pay later provider, which paid the store on her behalf. She then divided her payment into four interest-free installments of roughly $100 each.

“Food prices have surged,” said Hodge, a resident of Austell, Georgia, who carefully plans her grocery spending based on monthly cash flow and other financial obligations, including credit card and student loan payments. Spreading out grocery payments has helped her family of four, soon to be five, better manage their budget.

Hodge's experience reflects a broader trend: nearly 25% of buy now, pay later users are financing groceries today, up from 14% last year, according to recent survey data. Beyond groceries, these loans are increasingly used to cover regular monthly bills such as utilities, internet services, and streaming subscriptions.

Consumers also break down payments for fuel, food deliveries, and even rent into manageable installments. Social media platforms have become hubs where users exchange advice on leveraging short-term financing options for daily expenses.

While some borrowers view buy now, pay later plans as helpful tools for managing cash flow, the growing reliance on such credit for everyday necessities may also indicate mounting financial challenges faced by many households.