‘Buy Now Pay Later’ Increasingly Popular Among High Earners

As the vacation season winds down, many American shoppers are turning to Purchase Now, Pay Later (BNPL) choices to alleviate the stress of gift-giving amidst growing bank card money owed and surging inflation.

BNPL choices provided by corporations equivalent to Affirm, Afterpay and Klarna enable for purchases to be paid in installments, usually in six-week interest-free funds — however it’s not with out drawbacks, particularly for customers who overextend their budgets, Fox Enterprise reported.

Associated: Retailers Are Going to Shatter Low cost Data This Vacation Season — However You will Must Store the Proper Approach to Money In

People are saddled with a record-breaking $1 trillion in bank card debt, per CNBC.

And point-of-sale lenders are cashing in: Affirm shares have spiked greater than 400% this yr, outpacing all U.S. tech corporations value $5 billion or extra, NBC New York reported.

Ted Rossman, a senior business analyst at, advised Fox that BNPL is a type of debt with inherent dangers, together with potential rates of interest as excessive as 30% APR. “Generally I hear of individuals entering into bother with BNPL plans as a result of they trick themselves into pondering they’re spending lower than they are surely,” he stated, noting that the plans may complicate returns and refunds.

Nevertheless, it isn’t millennials, Gen Z or low-income shoppers who’re almost certainly to make use of these plans, based on a PYMNTS Intelligence analysis examine.

The examine discovered that almost 46% of high-income shoppers — outlined as these making greater than $100,000 yearly — have used retailer card installment plans within the final 12 months earlier than being surveyed, on common utilizing the plans twice throughout that interval.

Associated: PayPal Co-Founder’s Latest Startup Raises $100 Million to Reinvent Credit score

All shoppers ought to learn the tremendous print of BNPL providers rigorously, understanding the size of the mortgage and rate of interest, Rossman advised Fox.

Share on facebook
Share on twitter
Share on linkedin

Related Posts

Table of Contents

Find our article helpful?

Join our newsletter!

Scroll to Top