Buy Now, Pay Later (BNPL) programs like Affirm, Klarna, and Afterpay have revolutionized consumer spending by allowing shoppers to split purchases into installments, with $16.6 billion in online sales during the 2023 holiday season. The method is attractive due to fast approval, no need for a high credit score, and no interest charges. However, it comes with risks, such as not building credit and potential fees for missed payments. The Federal Reserve Bank of New York found that BNPL is most popular among women, younger people, and those with lower incomes and credit scores. Consumers need to be cautious, keeping track of payments to avoid fees and understanding return policies to prevent being charged for items they've returned.
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