The rise of Buy Now, Pay Later (BNPL) services has been rapid since their emergence around the globe. This form of payment has advantage of allowing people to purchase items immediately while making incremental payments instead of paying for the whole item upfront.
At the same time, Buy Now, Pay Later services have been seen as a contributing factor to the rise of credit card debt. In a 2018 survey conducted by CreditCards.com, 70% of respondents said BNPL services had contributed to their rising credit card debt.
This fear of credit card debt has been fueling the appeal of Buy Now, Pay Later services. Consumers are looking for a way to avoid accumulating more debt, and BNPL services appear to be providing a solution. This appeal is also fueled by the marketing of BNPL services through attractive incentives, such as signup bonuses and zero-interest periods.
The appearence of these services seem to be offering consumers a way to avoid the worry of racking up credit card debt. However, this could be a false sense of security, since some Buy Now, Pay Later services can carry high interest rates that can be financially harmful. Therefore, while BNPL services may be a welcome alternative for those uncomfortable with credit card debt, it is important for consumers to do their research and compare options to make sure they make the most financially advantageous decision for their particular situation.
