Buy now, pay later (BNPL) services are increasingly popular, especially among younger consumers looking for an alternative to traditional credit. Anthe Kelley, a yoga studio owner, found BNPL helpful for purchasing equipment in manageable installments, reminiscent of layaway plans. However, a Bankrate report reveals that over half of BNPL users have encountered issues, such as overspending and payment difficulties. BNPL plans lack the dispute-resolution policies of credit cards, leading to complications when dealing with returns or faulty merchandise. To avoid financial strain, consumers are advised to consider the total cost of purchases, understand specific terms of their payment plans which can range widely in interest rates, and set up safeguards like auto-payment to prevent missed payments and ensuing late fees.
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