They are becoming more and more popular these days: Buy Now, Pay Later (BNPL) services. In fact, a CNBC poll concluded that 25% of US consumers recently used a Buy Now, Pay Later service. As of now, it’s the second-most used form of credit payments in the US — only topped by credit cards.
As the costs of traditional borrowing are still high, and essentials like groceries and personal care items remain expensive, the popularity of BNPL services is not expected to vanish anytime soon.
Yes, using a BNPL service can be a flexible and relatively inexpensive way to take out a small loan, but there are definitely some risks associated with these types of loans. Before you use such a service, you may want to know what you’re signing up for. And that is why in this blog I want to walk you through the pros and cons of using a Buy Now, Pay Later service, as well as the two biggest risks associated with such loans (since it is essentially a loan). All so you can make a well-informed choice on whether or not to take on this relatively new form of debt.