Ecommerce is expected to have a banner year in 2021, and how consumers are paying for it is undergoing a shift. Following a strong first quarter fueled by government stimulus, digital research firm eMarketer has increased its forecast for U.S. retail ecommerce growth and now expects sales to grow 17.9 percent this year—up from 13.7 percent predicted in January 2021—to reach $933.3 billion. That pushes ecommerce’s share of total U.S. retail sales to 15.3 percent, up from 14 percent last year. Ecommerce is now on track to surpass 20 percent of total retail by 2024.

Total retail sales this year will increase by 7.9 percent to $6.083 trillion, exceeding $6 trillion for the first time. The two fastest-growing categories are apparel and accessories (up 28.7 percent) and home furnishings (up 11.4 percent). And because online sales account for about one-third of both categories’ total sales, those sectors will help drive overall ecommerce growth as well.

Meanwhile, total food and beverage sales are expected to show much flatter growth (3.3 percent) in 2021, after growing 11.8 percent in 2020. This comes despite ecommerce food and beverage sales growing by 21.7 percent this year, as online grocery shopping and dine-at-home behaviors spill over from last year. Another category that will see flatter growth this year, especially on the ecommerce side, is consumer electronics, whose online growth will drop to 12 percent after growing by 33.9 percent last year.

eMarketer also forecasts the number of U.S. consumers who will use a buy now, pay later (BNPL) service—defined as interest-free solutions provided by third-party payment platforms that allow consumers to purchase and finance a product or service and pay in scheduled installments; also known as digital installments, installment lending and point-of-sale financing. This year, 45.1 million people ages 14 and older will use a BNPL platform, up 81.2 percent over last year. This represents more than one-fifth (21.5 percent) of digital buyers in the U.S. By 2025, that figure will grow to more than one-third.

Younger consumers are driving adoption. Millennials account for 42.7 percent of BNPL users age 14 and older. That’s followed by Gen Z’s, which account for 30.3 percent.

“The pandemic has accelerated the growth of the BNPL industry by offering consumers more flexibility and easier payment plans,” says Oscar Orozco, eMarketer forecasting director at Insider Intelligence. “The surge in ecommerce has also been a boon to the industry, as consumers have relied more on digital shopping to fulfill their needs. BNPL solutions also provide an alternative to consumers who have reservations about credit cards with high interest rates. Merchants have increasingly adopted these services at the point-of-sale as a way to attract consumers, increase average order value, improve conversion rates and drive sales.”

The top players in the space are Klarna, Afterpay and Affirm. Klarna leads with 48.6 percent of BNPL users, followed by Afterpay with 28.1 percent and Affirm with 13.4 percent.