This seemingly helpful payment method may be a lot riskier than you think
New Report: More Americans Are Doing This to Pay for Groceries. Here’s Why Experts Are Concerned
Published on May 13, 2025
People across the country are quickly shifting their spending habits in the wake of newly imposed on-again, off-again tariffs that are raising prices on all sorts of everyday items. One of the biggest pain points Americans have when it comes to monthly spending, however, continues to be grocery shopping: According to NerdWallet, food prices have increased 2.4% since last year alone—and they are up 31% since 2019.
Naturally, many people are doing their best to reduce their spending on food. But since we all have to eat, a lot of Americans are using a new tactic to try to spend even less at the grocery store. Here’s what this strategy is and why it may be a risky move.
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What are more Americans doing to pay for their groceries?
Recent data from LendingTree shows that more Americans are using “buy now, pay later” (BNPL) to pay for groceries. In April 2025, LendingTree conducted two online surveys of roughly 2,000 U.S. consumers, ages 18 to 79, and found that 25% of BNPL users say they’ve used the loans to buy groceries, which is up 14% from data collected in 2024.
Buy now, pay later allows consumers to split payments into installments instead of paying the full price up front. Breaking down payments into smaller amounts can make products seem more affordable, thus making BNPL appear to be an attractive option, according to Certified Financial Planner Lissa Lumutenga.
“Many BNPL providers offer short-term, interest-free payment plans, which can feel like a better alternative to putting something on a credit card,” she explains. “As long as consumers make their payments on time, it makes big purchases seem more manageable and reduces the emotional stress of a big withdrawal from their bank accounts.”
What’s risky about using BNPL?
The issue with using BNPL for groceries, Lumutenga says, is that because food is consumed quickly, you’re essentially taking on debt for a disappearing purchase. “That can lead to juggling multiple short-term payments just to meet basic needs, which is a tough cycle to break,” she explains.
But there are actually a number of reasons that using BNPL is a risky move in general, not just for buying groceries. Here are the top risks:
There’s less consumer protection with BNPL
Lumutenga says that BNPL services may not offer the same level of fraud protection or dispute resolution processes compared with traditional credit cards. “If something goes wrong with your order or there’s a charge you didn’t authorize, you may not have the same safeguards in place,” she explains.
BNPL could have credit implications
Credit reporting for BNPL is inconsistent, Lumutenga says. “In the past, most BNPL providers didn’t report on-time payments to credit bureaus, but they did report missed payments or defaults,” she says. “So using BNPL responsibly wouldn’t help your credit, but falling behind could still hurt it.” Although that’s beginning to change as more credit bureaus and providers start incorporating BNPL data into credit reporting, there’s no clear system in place yet across all retailers.
BNPL ultimately benefits retailers more than consumers
BNPL helps boost sales by making bigger purchases seem more affordable and ultimately helps retailers’ bottom lines. “When people don’t have to pay the full amount upfront, they’re more likely to click ‘purchase,'” Lumutenga says.
There’s a bigger potential to overspend with BNPL
This higher likelihood of buying impacts everyday people’s spending, says budgeting expert Andrea Woroch. “BNPL leads to more impulse purchases because the monthly payment of the installment loan seems so much more affordable, which ultimately causes people to make impulsive buying decisions,” she explains.
BNPL can be difficult to track
When you have payment installments across retailers and websites, it’s easy to lose track of how many purchases you’ve made or installment loans you’ve taken on, Woroch says. “When bills are due on different days for different amounts, this can increase the likelihood of missed payments,” she adds.
What’s a better way to pay for groceries?
Rather than using BNPL, Lumutenga recommends using a debit card for everyday expenses like groceries, especially if you tend to overspend or are still learning how to budget. “Since the money comes directly from your account, it keeps you grounded in your actual cash flow and helps you avoid debt or interest charges,” she says.
Both Lumutenga and Woroch, however, say that using a credit card can also be a great option—when used responsibly. Since credit cards often offer cash back rewards, they can actually stretch your dollar further if you’re able to pay off the balance each month and don’t incur interest charges.
If you need to use BNPL, Woroch suggests using a budgeting app that tracks your BNPL purchases so that you can account for these payments in your overall budget and monthly spending plan and stay on top of the payments as well.
What else are Americans doing to save on groceries?
Another survey from Lending Tree about grocery shopping found that 88% of people surveyed have changed their grocery shopping habits in response to rising prices. This survey was conducted online in January and consisted of 2,039 U.S. consumers ages 18 to 79. Here’s what people across the U.S. say they are doing to help save money:
- 44% are buying more generic brands
- 38% are sticking to their lists
- 29% are paying closer attention to prices
- 27% are being more mindful of food waste
- 26% are using coupons more frequently
- 25% are forgoing their favorite splurges
- 24% started shopping at different stores with lower prices
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Sources:
- NerdWallet: “After Years of High Prices, Will Tariffs Reignite Food Inflation?”
- Lissa Lumutenga, Certified Financial Planner, Accredited Financial Counselor and founder of Wealth for Women of Color
- LendingTree: “BNPL Tracker: 41% of Users Late in Past Year, More Using Loans for Groceries”
- Washington Post: “Americans are spending less as they brace for new tariffs”
- Andrea Woroch, consumer spending and budgeting expert
- Lending Tree: “88% Say They’ve Changed Grocery Shopping Habits Due to Inflation — Here’s How”
