3.1m People Owe £2.7bn In Shadow Credit Boom - Buy Now Pay Later

29th August 2023

More than 3m UK households owe £2.7billion on 'buy now, pay later' (BNPL) borrowing, according to a new analysis by economists at the Bank of England.

The figures, which showed those aged between 25 and 34 were the most likely to use it, shed light on the extent of the unregulated practice.

And they suggest users are more likely to be financially vulnerable - likely to raise concerns of a ticking time bomb for borrowers.

Experts warned some shoppers were using BNPL without understanding the burden they were taking on.

ttRead the full story HERE

Read the more detailed report HERE

Most providers do charge late repayment fees, but if you ensure you never miss a payment, using BNPL shouldn't ever cost you a penny. While the idea of spreading your costs for free over a number of weeks might seem like a good one, make sure you've always got a plan in place for repaying what you owe.

Is there a downside to buy now, pay later?
Like any payment method, buy now, pay later comes with some pros, like splitting payments, 0% financing and no credit check—and some cons, like fees, overdraft potential, possible financial overextension and missing out on rewards opportunities.