Financial experts are sounding the alarm for young Brits who frequently use Buy Now, Pay Later (BNPL) services, warning that these seemingly convenient schemes could lead to serious debt problems.
With the rising cost of living, many young people are turning to BNPL options to spread out payments for clothing, electronics, and other purchases. However, these services often come with hidden risks that can quickly spiral into unmanageable debt.
Why BNPL Can Be Dangerous
Unlike traditional credit, BNPL schemes often don't perform rigorous credit checks, making them easily accessible but potentially harmful:
- Missed payments can result in hefty fees
- Some providers report late payments to credit agencies
- Easy access can encourage overspending
- Multiple BNPL accounts can quickly become unmanageable
Protecting Yourself
Financial advisors recommend:
- Always read the terms and conditions carefully
- Set up payment reminders to avoid late fees
- Limit the number of BNPL accounts you use
- Consider whether you'd buy the item if you had to pay upfront
With Christmas shopping season approaching, experts urge young consumers to think twice before using these services for holiday purchases.
