2025 State of Mobile is Live!
Sensor Tower · Seema Shah · March 2023
BNPL App Adoption Soars, Although Delinquency and Churn Rise
The three largest BNPL players, Affirm, Afterpay, and Klarna, experienced rapid user growth in 4Q22, although at a slower pace than in 2021 due to the pandemic. Total installs of BNPL apps soared in 2022 as consumers sought ways to stretch their wallets in an inflationary macro environment. Affirm was the only BNPL service out of the big three to see a significant uptick in installs during the holiday shopping season, potentially driven by its partnership with Amazon. As more key players enter the BNPL space, securing exclusive partnerships with large brands could become more competitive, and acquiring new customers could prove more challenging for the big three BNPL services.
Key Takeaways:
The largest three players in the BNPL space saw rapid user growth in 4Q22, although this growth was a deceleration from COVID-fueled 2021 growth: ST estimates indicate that MAUs on Affirm, Afterpay, and Klarna in 4Q22 increased 59% YoY (vs +89% in 4Q21), 24% (vs +72% in 4Q21) and 21% (vs +58% in 4Q21), respectively
Adoption of BNPL apps soared throughout 2022 as consumers sought ways to stretch their wallets in an inflationary macro environment: total installs of Klarna (24mn), Affirm (8mn), atome (5mn), and Tabby (4mn) were up 13%, 46%, 155%, and 240% YoY in 2022, per ST estimates, while Afterpay (9mn) and Zip (3mn) saw installs fall 10% and 19% YoY, respectively
During the busy holiday shopping season (4Q22) Affirm was the sole BNPL service out of the big three to see a significant uptick in installs, up 22% YoY (+28% QoQ), potentially driven by its partnership with Amazon, which makes it the sole BNPL provider for the company (but not for long)
As more key players enter the BNPL space (notably Apple), securing (and retaining) exclusive partnerships with large brands could become significantly more competitive and acquiring new customers could prove more challenging for the big three BNPL services
ST data indicates that user churn soared on all three of the largest BNPL apps following the holiday season rising 6pps, 5pps and 2pps in Feb’23 vs. Dec’22 on Afterpay, Klarna, and Affirm, respectively. This significant uptick in user churn indicates that the amount of users who neglected to open their favorite respective BNPL app at least once during the month has increased since the conclusion of the holiday shopping season
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