Why Store Card Instalments Are Winning Over Younger Shoppers

Private-Label Instalments Outpace Traditional Credit Cards

Traditional credit cards have long been the backbone of American consumer spending. But the latest data from PYMNTS Intelligence shows that private-label store cards are growing faster for instalment payments, showing a shift in how consumers manage credit.

Faster Growth Among Store Cards

Private-label instalment plans, often offered by retailers for larger-ticket items, have expanded at a 4.8% compound annual growth rate over the past two years. By contrast, general-purpose credit card installment use has grown only 0.8% annually.

Although private-label cards still account for a smaller share of the credit landscape, their pace of growth highlights a meaningful change in consumer behaviour. Younger shoppers, in particular, are embracing predictable, interest-free payment options instead of revolving debt.

Who Is Driving the Shift

• Gen Z boosted private-label instalment use by nearly 20% between 2023 and 2025
• Millennials saw modest growth of 0.8% annually
• Gen X usage declined slightly

Middle-income households are also showing strong adoption. They are attracted by easier credit access, loyalty perks, and promotional financing.

Predictability and Control

The appeal of private-label instalments is simple. Consumers get predictable, fixed payments without compounding interest. This structured approach meets a broader desire for control over spending. Many shoppers are choosing these plans over traditional installment options on general-purpose cards, especially for electronics, furniture, and other big-ticket purchases.

Implications for Banks and Card Issuers

The message is clear for traditional card issuers. Private-label instalments are capturing the loyalty of younger, influential consumers. To compete, banks may need more than cashback rewards. They will need tailored, flexible options that mirror the predictability and perks offered by retailers.

The rise of private-label instalments shows a broader trend in credit. Consumers want manageable, transparent payments that fit their lifestyle. Retailers that provide that option are winning over the next generation of spenders.

Payment Solutions with Kubera Payments

At Kubera Payments, we help businesses across North America move millions of dollars daily, whether in-store, online, or on mobile. Our team of payment experts is here to guide you through the complexities of payment processing, ensuring your transactions are secure, reliable, and PCI-compliant. We have strong relationships with a wide network of acquirers and can help you find the right front-end and technology solutions to work together.

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Contact our team at sales@kuberapayments.com or 604-484-9278