U.S. retailers are increasingly relying on buy now, pay later (BNPL) payment options as high interest rates and concerns about weaker consumer spending weigh on the sector.

BNPL is spreading because it lets consumers split payments, making it easier to increase spending without feeling the burden.

A recent Forbes report showed that the average order value at merchants that adopted PayPal's BNPL rose 91 percent.

Competition among providers is also spreading. Alongside PayPal, major services such as Afterpay, Affirm, Klarna, Zip, Splitit and Sezzle are leading the market, while major card companies are expanding similar options, Forbes said.

Warnings are also growing because people who mainly use BNPL are described as "financially vulnerable" consumers. A Federal Reserve bank survey showed 55 percent of BNPL users had used it in the past, 22 percent currently had a balance and 19 percent had taken loans from multiple BNPL providers over the past year.

In the past, BNPL loans were "ghost debt" that was not included in credit scoring, but major credit rating agencies have recently begun collecting data and bringing it into their systems. At the same time, lawmakers on the U.S. Senate Banking Committee sent letters to major BNPL firms demanding user information and greater product transparency.

The risks are seen as greater because BNPL is expanding to become a way for low-income people to buy daily necessities.

The U.S. Federal Reserve pointed out that BNPL users have, on average, $871 more in credit card debt than non-users with the same credit score. In particular, Generation Z and millennials prefer BNPL to credit cards, and delinquency rates were found to reach as high as 57 percent.

Federal Reserve Governor Michael Barr warned that "BNPL is a debt trap" and said "delinquency rates have risen to 25 percent, and it is not a sustainable model."