The article explores the transformative impact of buy-now-pay-later (BNPL) services on consumer spending habits, particularly among younger and lower-income shoppers. Traditionally, borrowing money for purchases required a lengthy process involving bank applications and credit limits, but BNPL has simplified this with fast, interest-free installment payments integrated into online checkouts. Research indicates that consumers utilizing BNPL spend an average of 6.42% more than those who do not, especially on low-ticket items. This phenomenon is linked to psychological factors such as hyperbolic discounting, where immediate gratification outweighs future payment concerns. The BNPL sector is projected to grow significantly, with over 670 million users expected globally by 2028. However, the article also warns of potential risks, including hidden fees and the tendency to overspend. It emphasizes the importance of responsible usage and understanding the terms and conditions to avoid falling into financial pitfalls.
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