Buy Now and Pay Later Could Lead to Piles of Debt

One of the biggest trends in the last 5 years has been the ease at which you can make a purchase and pay later via monthly installments; firms like Klarna, Laybuy and Clearpay all work with retailers to allow customers to buy items but finance them at the time of purchase; the idea behind the process is customers are willing to buy more if they do not have to PayU the full rate now; this has also led to less returned items for retailers, Klarna and Afterpay both say that returns dropped by 20 percent; there is a growing concern that this will only lead to more debt for customers and therefore put them in a similar position to other credit products; many of these fintechs will not allow customers to keep buying if they defaulted as they try to ensure responsible borrowing; this trend is only increasing with many of these services now available in physical locations alongside their online presence. Source.

Todd is the Chief Product Officer of LendIt Fintech.

He is the host of PitchIt: the fintech startups podcast, a weekly interview show featuring emerging fintech founders and leading venture capitalists.

He is responsible for leading the content team which covers fintech through daily & weekly email newsletters, editorial, virtual events, and in-person conferences.

He has been covering fintech, banking, and venture capital for more than 15 years, including speaking regularly at industry events.

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