May 14, 2024COTW: BNPL

  • Buy Now, Pay Later (BNPL) is a financial service that allows consumers to purchase products immediately and pay for them over time through a series of installments. Typically, these payments are interest-free if paid on schedule. BNPL services have grown in popularity, especially in online shopping, providing an alternative to traditional credit options like credit cards.
  • According to Adobe Analytics, $25.9bn of e-commerce spend was driven by BNPL between January and April this year, up 11.8% year-over-year.
  • A recent survey by Bloomberg found that consumers have been spending more using BNPL, and spending more than they could afford. More than 30% of survey respondents said they’d spent more than $1,000 using BNPL, while 54% of respondents said that they spent more than they could afford. 34% of survey respondents said they were worse off financially using BNPL for shopping. 43% of BNPL borrowers reported being late on payments.
  • Moreover, major BNPL providers like Affirm, Klarna, and Afterpay do not report loan details to credit agencies, which is likely leading to gaps in consumer financial data and may be distorting the overall health of the consumer.


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