Retailers that accept BNPL often raise sticker prices to cover the financing fee, which leaves cash-paying customers subsidizing the ones who split their purchases, according to a study forthcoming in Management Science from Washington University’s Olin Business School. The retailer’s effective price, meaning what it keeps after the provider takes its cut, can fall even while unit sales rise. In millions of simulated scenarios, BNPL also pushed retailers toward thinner inventory, since a lost sale costs them less, and it never made a money-losing product profitable. About a third of BNPL users now put groceries on the plans, a growing share put rent and bills on them, and roughly 41% have missed a payment in the past year.
