What is Buy Now Pay Later?

Buy Now Pay Later might seem like a convenient option for users who wants to take advantage of borrowing at checkout, however the convenience can sometimes have a cost. What these accounts end up doing is actually enables consumers to spend more money on things that might fall out of their budget or just be plain unnecessarily. When this happens, some consumers end up buying items that might be just plain unnecessary. You don’t need to put your GrubHub burrito on a Buy Now Pay Later account but that is an option that is available to you. What inevitably ends up happening due to these options is that consumers tend to spend more on things they probably don’t need, simply due the convenience of the option.

Convenience

Convenience is great when it brings ease into your life but sometimes it also opens up the door to irresponsibility. You can only blame yourself for being irresponsible but sometimes it’s better to not have one of these accounts at all if it makes you more prone to spending on things you might not need. And Buy Now Pay Later accounts are quite convenient. The application process is much easier than applying for a credit card but that doesn’t make it any better than a credit card. The convenience typically comes with a cost and it’s something to be aware of.

Purpose of BNPL

BNPL is meant to be an easier form of credit for consumers to enjoy mostly for ease of application and ease of use. As we know things that are “easy” can either be good or bad. During the Great Recession mortgages were given out extremely easily and due to this many people lost their shirt and experienced tremendous financial hardship. This may not be the exact same scenario and that still remains to be seen but it’s something that you should be mindful of. This is also one of the main reasons why debt has become so ingrained into our society.

Buy Now Pay Later is an innovative option that increases credit availability to consumers with its ease of use and convenience to credit. However, it still remains to be seen whether these accounts have a net positive on society at large. They are now being integrated into consumer credit reporting and well onto the path to becoming mainstream.