Buy Now Pay Later (BNPL) - the revolutionary new industry standard that may replace credit cards

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BNPL is about to revolutionize the online shopping and payments ecosystem but...


Today, Australia became the first country to implement industry norms for BNPL to safeguard consumer's interest. If you have used a credit card and missed the payment, then you know the pain - the interest charges are by no means reasonable. With BNPL, there is no interest, but you will have to pay a late fee and it was quite unregulated until now thus allowing the providers to take advantage. The BNPL providers were earlier exempted from traditional lending regulation because BNPL was not viewed as a loan. However, it ended up being in a situation where consumers were lured with irresistible offers putting more debt on them. And the result - almost 20% of consumers missed their payments and ended up paying late fees. Even some consumers landed in such bad situation that they had to take other loans to pay their BNPL payment but the providers took all the advantage of this unregulated sector to increase their profit from this business model.

With regulations in place, it will be good for the consumers - especially who were not allowed to take a credit card, can now use this feature with peace of mind because of clear and transparent fee structure. More ever, its binding on the BNPL providers to check the consumer's age and financial condition. Earlier they were targeting the young group putting seductive psychological trick making them feel the product cost less expensive, irrespective of whether they can afford it or not. The regulations will definitely improve this area by not allowing the providers to take advantage of people less than age of 18 to go for this debt. And more ever, the providers are expected to have fair and reasonable late fees, that comes with appropriate notice. Some time, a payment is missed because of not getting a notice beforehand and thus forgetting to pay in time. But now this is going to be binding equally on providers. Hopefully we will see regulations in all countries protecting Consumer interest.

Have you used any BNPL offer any time ? Paypal also provides such an offer , but I have not tried yet. Affirm in partnership with Cross River Bank, is also issuing such a card and promises to provide such offer without any surprise. If you are in US, then you may try it, and share your experience. I will be looking for such providers in India - right now, I have one from Bajaj Finance , but they do charge processing fees, for which I am not using it anymore.


It's easy to use such offers, but at the same time, its equally important to restrict our spending to our affordability, please share your opinion / experience on this.

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I think these buy now pay later actions are bad. My thoughts are that if you don't have the money, you shouldn't buy it at all.

I've seen l people buy stuff they couldn't afford now. But the future is uncertain, so who knows if you can still pay it later on?
I also know examples of people that bought expensive things like TV's and smartphones that got broken even before they were paid off. Those people had to buy new thing before they paid off their old ones.
You could easily get into problems if you're not careful enough.

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I think, people got all the stress along with blood pressure , diabetes after the EMI scheme started - these are just old wine in new bottle 😀

"The road to hell is paved with good intentions" as the old saying goes. Somehow I feel the higher-ups that orchestrated this policy hoped this would be the end result. I think predatory economic practices are on the rise during this global recession. In the end the poor are hurt exponentially more than the rich by policies like these.

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That is an interesting product, although it's not for me as I'd like to stay debt free as much as possible. I'm surprised to see PayPal as they are so rigid, there has been many complaints against them but I guess business is business and where there's an earning opportunity ... they take it.

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yeah that how it works in the business but like yourself, I also like to be free and I don't like the feeling of being in debt

it's a nice offer to buy now pay later and I hope it will start working In my country too

Financial charges are painful, if you miss the payment then you have to pay the late fee as well as the financial charges...

And if you are not set with auto debit, you will definitely miss it few times.