Martin Lewis and his Money Saving Expert team have raised an urgent alert regarding the use of Buy Now, Pay Later (BNPL) services like Klarna and Clearpay, which have become increasingly popular among consumers in the UK. In his latest newsletter, Lewis cautioned users to be vigilant as the current lack of regulation surrounding these services poses significant risks, especially since changes to the rules won’t take effect until 2026. While BNPL can offer a convenient way to manage payments, many users are unaware of the potential pitfalls, including late fees and negative impacts on their credit ratings if repayments are missed. The upcoming regulatory changes will introduce necessary safeguards, such as clearer information about risks, mandatory affordability checks, and consumer protections similar to those provided by credit cards. Until these regulations are implemented, Lewis advises consumers to approach BNPL services with caution to avoid potential financial difficulties.
Read the full article here.