Kristin Herman said using a „buy now, pay later“ service to pay for a last-minute trip to Miami felt like a lifesaver.
She said the approval was quick, and there were no upfront costs — but she accidentally skipped a scheduled payment.
„One missed reminder turned into fees,“ she told CNBC Travel.
Rane Teo, however, said he used a buy now, pay later — or BNPL — plan to break up the cost of a weekend stay for his family on the Indonesian island of Batam.
His experience with splitting the cost into three monthly installments? „Easy and convenient,“ he said.
Both Herman and Teo are part of the growing number of travelers who are using BNPL services to pay for flights, hotels and cruises in installments, in some cases with no interest or late fees.
BNPL company Klarna in September announced that the value of travel bookings it processed increased 50% in the past year, while Affirm reported its travel and ticketing volume rose 38% year on year in the final quarter of 2024, crossing the $1 billion mark.
In 2025, nearly one in five American travelers said they plan to use a BNPL service to pay for their summer vacations, according to a March report by the personal finance website NerdWallet.
BNPL services are catching on in China too. In January, the online travel platform Fliggy said the volume of BNPL travel purchases rose more than 20% from 2023 to 2024. The company, a subsidiary of Alibaba Group, projected that usage will continue to grow in 2025, especially among younger travelers.
„Notably, nearly one-quarter of consumers opting for this model were born between 1995 and 1999 — often referred to as Gen Z — while the proportion of consumers born in 2000 or later has seen the fastest growth, nearing 20%,“ according to a Fliggy press release.
Gen Zs and millennials are also more likely to use BNPL plans to travel for live events, according to the financial services company Bread Financial.
Some 60% of general admission ticket buyers for this month’s Coachella musical festival opted to pay via payment plan, which tacked on a $41 handling fee, Billboard reported.
Tickets, which were $50 per day in 1999, start at $539 for a three-day pass in 2026.
Should you — or shouldn’t you?
BNPL can be a valuable tool for financing vacations „when used responsibly,“ said Sunil Sachdev, head of embedded finance at the global fintech company Fiserv.
He said the service has matured in the past few years, and that BNPL loans have not resulted in widespread defaults, despite early concerns.
Carrington Labs CEO Jamie Twiss agrees that BNPL can be an effective way to spread out travel costs. He said defaults for BNPL travel purchases are lower than other purchases because more people are using the service as a new form of payment, rather than a means of accessing funds.
„Or put another way, a higher percentage of people use BNPL for travel, even though they already have enough money in their accounts to cover the cost,“ he said.
But, like all debt, BNPL loans can be a slippery slope, according to NerdWallet’s release, which cited a January Consumer Finance Protection Bureau report that determined 63% of BNPL borrowers in 2022 had more than one loan at one time.
„Stacking“ is just one problem with BNPL loans, said Andrew Lokenauth, founder of TheFinancialNewsletter.com. Others include problems reaching company customer service and repaying loans after unexpected life events, such as job losses and vehicle breakdowns.
Andrew Lokenauth said more of his clients are using „buy now, pay later“ for basic travel expenses, such as family visits and weddings. „It’s not just luxury vacations anymore.“
Kamil Krzaczynski | AFP | Getty Images
„I’ve worked with over 100 clients drowning in BNPL travel debt, and it’s not pretty,“ he said. „These loans have zero flexibility — miss a payment, and you’re hit with late fees and a credit score ding.“
However, not all BNPL companies operate the same way. Affirm says it does not charge late fees and also vets — and rejects — potential customers.
Affirm’s investor pages state that so-called „pay in 4“ loans are not reported to credit agencies, however the company announced it began reporting all pay-over time products to Experian on April 1, with TransUnion to follow on May 1.
Travel agent Precious Caroll said she advises clients to use BNPL only if they have the funds for a trip. However, she said BNPL is „great for when a deal comes up so they can get the trip booked without having the full funds available.“
Disney vacation planner Jackie Steele said more travelers are using BNPL to pay for Disney trips.
„I’ve had readers and clients tell me it’s what allowed them to make a last-minute trip work or splurge on something like staying at a deluxe resort,“ he said. „That said, I always caution people — especially younger adults or families on tight budgets — to look beyond the monthly breakdown.“
Last-minute trips, in particular, can be problematic because the incentive to pay can drop once the trip ends. Travelers can avoid this by making BNPL plans earlier, and paying in full before a trip..
Benson Varghese, a managing partner at the Texas-based law firm Varghese Summersett, said a surprising number of his clients have run into legal trouble or financial strain because of BNPL purchases.
„Especially in the travel space,“ he added. „We’re now including [guidance] in our financial literacy sessions at the firm because it’s become more common than credit card disputes.“
Lokenauth said he has a „controversial take“ for those considering whether to use BNPL for travel expenses.
„If you can’t pay for a vacation outright, you probably shouldn’t take it.“
Clarification: This article has been updated to clarify Affirm’s credit reporting policy changes.
