In the face of rising inflation, many Americans, particularly Gen Zers and millennials, are increasingly turning to Buy Now, Pay Later (BNPL) programs as a financial strategy. These programs offer short-term installment loans, often interest-free, allowing consumers to purchase items immediately and pay over time. While BNPL can be beneficial by extending budgets and providing easy access to goods without immediate full payment, there are significant risks involved. Users may face high fees, increased debt from multiple loans, and challenges with returns. Additionally, reliance on BNPL might lead to missed credit card rewards and potential overdrafts if not managed carefully. A LendingTree survey highlighted that a third of BNPL users had made late payments in the past year, indicating a potential for financial strain.
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