Buy Now Pay Later(BNPL) Market Analysis

In South America, the BNPL concept has emerged as a modern iteration of long-standing installment culture Brazil’s parcelamento has long allowed consumers to split payments across many months, and today firms like Nubank’s Nubank Pay, Mercado Pago, PicPay, and PagSeguro are bringing digital split-payment models into both online and offline retail. Mercado Libre, for instance, now promotes “Mercado Crédito” and “Mercado Pago” services offering deferred or installment payments directly in its checkout flows, leveraging its massive user base and financial arm. PagSeguro’s move to embed installment options in point-of-sale terminals and mobile wallet apps (such as its “Buy Now, Pay Later” feature in its app) has helped bring BNPL into physical retail outlets across Brazil. In Argentina, companies like Prisma Medios de Pago have piloted installment features in card and merchant networks, while fintechs such as Ualá have begun exploring “pay later” models integrated into their wallets. The shift from informal, store-credit systems to instant digital payments relies on APIs and wallet integrations, especially in mobile-first markets like Brazil and Chile, allowing merchants to request credit from BNPL providers in milliseconds. To manage fraud and credit risk, many providers in the region factor in data such as consumer purchase history on e-commerce platforms, wallet top-ups, and alternative scoring models beyond classic credit bureau data, which is patchy in many markets. Brazil’s National Monetary Council (CMN) and the Central Bank have discussed new guidelines for consumer credit transparency, aiming to impose clearer disclosure rules and consumer rights protections on BNPL providers. Data privacy laws such as Brazil’s LGPD add further constraints, requiring BNPL firms to ensure customer data is stored and managed carefully. Meanwhile, a provider in Brazil must comply with local banking statutes, taxation rules and license regimes rather than using a single Latin America license, meaning many BNPL providers build localized operations with dedicated compliance, KYC, and settlement workflows. According to the research report "South America Buy Now Pay Later (BNPL) Market Reserach Report, 2030," published by Actual Market Reserach, the South America Buy Now Pay Later (BNPL) market is expected to reach a market size of more than USD 64.83 Billion by 2030.

Mercado Libre and PagSeguro are among the leading platforms, having scaled “buy now, pay later” options in Brazil and neighboring markets by embedding installment and credit services throughout their checkout and wallet offerings. In Brazil, fashion and electronics remain the segments with highest BNPL usage, but growth is notable in education, health, and travel financing, as providers extend installment options beyond retail. Small and medium merchants adopt BNPL via plug-ins and integrations from Mercado Pago or PagSeguro, enabling them to offer installments without in-house credit infrastructure. Large retailers like Magazine Luiza and Casas Bahia have integrated split-payment features both in physical stores and online, often in partnership with BNPL fintechs to manage credit risk and settlement. Generationally, younger consumers have driven uptake through mobile commerce and digital wallets, but older cohorts are increasingly exposed to BNPL in-store as retailers promote point-of-sale installment options. Retailers report meaningful uplift in conversion and average order size when installment options are visible at checkout, especially on higher-cost items. Brazilian and regional banks are exploring co-branded installment products or partnering with fintechs for capital backing, while PayPal and Apple Pay have begun exploring pay-later features in Latin American markets. Expansion into non-retail verticals is underway some travel platforms and elective medical service providers now offer installment plans. However, regulators remain attentive to risks of consumer overextension, Brazil’s central bank and consumer protection agencies review proposals for requiring clearer affordability checks and disclosures, particularly for frequent BNPL users.

BNPL providers partner with retail loyalty programs and cashback schemes to incentivize usage across merchant networks. .

Market Dynamic

Buy Now Pay Later(BNPL)Segmentation

Online is the leading BNPL channel in South America because expanding e-commerce, digital wallet adoption, and consumer demand for installments are converging to make BNPL a natural part of online checkouts.

The acceleration of online BNPL in South America is strongly tied to the surge in e-commerce and digital payment adoption across the region. Countries like Brazil, Mexico, and Argentina have seen a dramatic shift toward online retail, driven by improved internet penetration, smartphone adoption, and greater consumer comfort with digital shopping. In these markets, installment payments are already part of consumer culture through systems like Brazil’s parcelamento, which conditions buyers to expect flexible payment options. BNPL adapts this familiar behavior into the digital space, making it an easy transition for consumers who are already accustomed to splitting costs. Online retailers and marketplaces such as Mercado Libre, Americanas, and Magazine Luiza have embraced BNPL because it boosts sales, reduces cart abandonment, and helps them capture customers who may lack credit cards. Digital wallets like Mercado Pago and PicPay have further accelerated BNPL’s online growth by embedding installment features directly into their platforms, ensuring wide visibility for consumers at the moment of purchase. Younger demographics who dominate online shopping are particularly receptive to BNPL, but adoption is broadening as more households use e-commerce for essentials, electronics, and services. Cross-border shopping is another driver, with South American consumers using BNPL to buy international brands online without bearing high upfront costs. Seasonal events such as Black Friday and regional shopping festivals amplify demand, with BNPL becoming a default choice for managing larger purchases during peak periods.

Gen X and Boomers are the fastest growing BNPL adopters in South America because their familiarity with installment culture and rising comfort with digital shopping align well with BNPL’s transparent and practical repayment structure.

The growing BNPL adoption among Gen X and Boomers in South America reflects the intersection of long-standing financial habits and newly embraced digital lifestyles. For decades, consumers in these age groups have relied on parcelamento and other installment practices to manage larger household and personal expenses, so BNPL feels less like an innovation and more like a modernization of something they already trust. What has changed is the rapid shift of these demographics into online and mobile shopping, a trend accelerated by the pandemic, which forced many older consumers to adopt digital payment methods. As they now shop more frequently on platforms like Mercado Libre, Amazon, and Rappi, they encounter BNPL as an embedded option that mirrors their offline installment behavior. Gen X, often in their peak earning years but balancing mortgages, education expenses, and lifestyle spending, use BNPL to manage cash flow without incurring costly credit card interest. Boomers, many of whom are living on fixed incomes or retirement funds, see BNPL as a practical way to spread costs of healthcare, travel, or home improvements without drawing heavily from savings. Providers in South America emphasize simple, transparent repayment schedules that reassure older users who prioritize predictability and dislike hidden charges. Retailers and wallets are also tailoring marketing to these demographics, showing BNPL as a trusted and mainstream option rather than a youth-focused trend. The cultural acceptance of installments combined with growing digital literacy and the appeal of practical, interest-free repayment structures explains why Gen X and Boomers are now the fastest growing BNPL adopters in South America.

Large enterprises and global retailers lead the BNPL market in South America because their scale, brand trust, and ability to integrate installment options across online and offline channels ensure wide consumer adoption.

Large enterprises and global retailers are central to BNPL’s success in South America because they have the reach and resources to implement installment solutions across both physical stores and online platforms, ensuring that consumers encounter BNPL at every stage of the shopping journey. Brazilian giants like Magazine Luiza, Americanas, and Casas Bahia, along with international players like Amazon and Carrefour, have all partnered with BNPL providers or embedded their own solutions to attract customers. These retailers already operate in environments where installment culture is deeply ingrained, so offering BNPL is a natural extension of their existing strategies. Their scale allows them to negotiate favorable terms with providers and subsidize interest-free options, making BNPL more attractive to consumers. Because of their brand recognition and established trust, shoppers are more likely to try BNPL when it is offered by large, well-known retailers rather than unfamiliar smaller merchants. Cross-border e-commerce is another driver, with global retailers enabling South American consumers to buy international products through installments, lowering barriers to access. Large enterprises also integrate BNPL into loyalty programs, apps, and omnichannel platforms, ensuring consistency for consumers whether they shop online or in-store. For BNPL providers, partnering with these enterprises is the fastest way to scale user adoption, as one integration can expose the service to millions of shoppers. Seasonal sales events, which are heavily driven by big retailers, further highlight BNPL as a promotional tool, reinforcing its role as a mainstream payment option.

Buy Now Pay Later(BNPL) Market Regional Insights

Brazil leads in South America because a retail tradition of parcelamento, lower credit card penetration and rapid e-commerce growth created a natural place for BNPL to scale.

Brazil’s leadership in BNPL in South America traces to a retail culture already comfortable with parcelamento, a payments infrastructure that supports installments and a large unbanked or underbanked segment seeking credit alternatives. Retailers in Brazil long offered multi-month payment plans at the point of sale, which conditioned consumers to accept installments for everything from clothing to electronics and furniture. E-commerce growth, mobile adoption and expanding logistics networks pushed more transactions online and gave BNPL providers large merchant pools to integrate with. Credit card penetration has historically been lower for large parts of the population, so BNPL provided an alternative that required lighter upfront underwriting and faster onboarding. Local fintechs adapted products to Brazilian tax, invoicing and consumer protection frameworks, offering installment plans that accounted for local business practices. Many BNPL providers partnered with established payment acquirers, digital wallets and local banks to access capital, simplify reconciliation and gain merchant distribution. Promotional strategies such as zero-interest installments and merchant-subsidized plans became familiar marketing tools that drove both conversion and higher average baskets. Direct debit, boleto bancário and local bank transfer mechanisms were leveraged for reliable collections and reconciliations, meeting Brazilian payment preferences. Providers used alternative data such as mobile behavior and purchase history to approve small loans at scale in a market where formal credit scores were incomplete. The informal economy and cash transactions remained prominent in some segments, but BNPL bridged the gap by offering a digital, traceable financing option that appealed to online shoppers. Regulatory attention in Brazil emphasized consumer disclosure and fair practices, prompting providers to design clearer terms and dispute mechanisms that increased trust. Merchants valued BNPL for the uplift in sales and the operational simplicity when integrations with checkout providers and marketplaces were implemented. Localized user experiences in Portuguese, integration with Brazilian logistics and tailored repayment schedules reduced friction and improved collection performance.