Long Holders, ZIP 2024 Retrospective A Year to Remember, Victory Dance Time, page-168

Better effort to address the point of the Hot Copper ZIP forum Freefromstyle, but much of the take up in BNPL is among those who can ill afford the exorbitant fees. Many BNPL users are turning to alternatives after maxing out their credit cards.

User Demographics

BNPL usage varies across different demographic groups:

• Low credit scores and past bankruptcy filing are the factors most strongly correlated with BNPL use
• 23% of consumers with credit scores below 600 used BNPL at least once, compared to only 2.8% with credit scores higher than 800
• BNPL use is most common among the middle-income group earning $50,000 to $75,000 a year
• Women, Black, and Latino consumers are significantly more likely to use BNPL compared to other demographic groups

Financial Behavior

BNPL users tend to have different financial characteristics compared to non-users:

• BNPL users have significantly less money in liquid assets, with an average checking account balance of $2,179 compared to $6,638 for non-users
• 71% of BNPL users revolved on their credit cards in 2023, compared to 40% of non-users

And here is CS herself:

Cynthia Scott describes Zip's US target market as a significant opportunity, focusing on underserved consumers looking for access to fair credit. She highlights several key points about this market:

1. The US market for consumer finance at point of sale is still in its early stages, representing less than 2% of total payments, compared to about 15% in Australia or New Zealand
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2. There are approximately 100 million adult Americans who are currently underserved by traditional financial institutions
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3. The target market includes people with lower FICO scores who may not qualify for traditional credit card products or financial services
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4. It also includes newcomers to the US who may have difficulty obtaining credit cards due to lack of credit history
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5. The average Zip customer in the US is in their late 20s, compared to late 30s (37) in Australia and New Zealand
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Scott emphasizes that out of the potential 100 million underserved Americans, Zip currently has 4 million customers on its platform, indicating significant room for growth

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. She also notes that the US market presents the largest opportunity for Zip, partly due to the number of underserved customers looking for fair credit access

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Not a very noble business enterprise IMO. Fact is, the business model cannot stand on its own 2 feet - there is not enough in it and the only way to eek out a living is to charge massive fees