Italy's BNPL Market: Risks and Regulatory Oversight
A Banca d'Italia study reveals rapid growth in Italy's Buy Now Pay Later (BNPL) market, with usage increasing from 4 percent of households in 2022 to 30 percent in 2025. The analysis highlights that BNPL is increasingly used by financially vulnerable individuals, prompting new EU regulations.
Financially fragile users
A recent Banca d'Italia study, drawing on the 2022 Household Budget Survey (IBF) and the 2025 Economic Survey of Italian Households (ICF), reveals a significant surge in Buy Now Pay Later (BNPL) usage across Italy.
Household adoption jumped from 4 percent in 2022 to 30 percent in 2025, though approximately two-thirds of users engage only occasionally.
Consistent with international trends observed in the United States and other European countries, BNPL is increasingly attracting financially vulnerable segments of the population.
These users typically exhibit low-to-medium incomes, limited assets, and existing indebtedness, often for consumption purposes or to consolidate other debts.
A notable finding is the widespread use of BNPL among individuals already behind on their debt repayments.
Globally, the BNPL market reached $342 billion in 2024, representing 5 percent of e-commerce transactions.
In Italy, BNPL transactions soared from €1 billion in 2021 to €9.9 billion in 2025, with online purchases accounting for over three-quarters of the total.
The average value of these deferred payments stands at just over €200.
Defining the payment deferral
Buy Now Pay Later (BNPL) is commonly understood as an interest-free payment deferral, typically in 3-4 installments, for relatively small purchases.
This service is generally free for the consumer, excluding late payment penalties, and features a rapid, often simplified credit assessment.
BNPL operations usually involve three parties: the vendor, the consumer, and a financial intermediary who assumes the credit risk, often for a vendor commission.
Advantages include interest-free spending, potential financial inclusion for those with limited credit history, and a streamlined digital application.
However, the market's rapid growth introduces vulnerabilities due to limited detailed data on transaction volumes and associated credit risk, making comprehensive evaluation challenging.
Stricter rules for consumer protection
The upcoming EU Consumer Credit Directive (CCD2), applicable from November 2026, represents a crucial regulatory response to the identified BNPL vulnerabilities.
By imposing stricter transparency and rigorous creditworthiness assessments, the directive aims to mitigate the risks of over-indebtedness among financially fragile users.
This regulatory intervention is expected to foster greater consumer protection and enhance overall credit quality in the rapidly expanding BNPL market.