Using the installment payment plans, she said, she increased her average purchases from $200 to $400 an order over time. “They can be helpful to consumers in the sense that they don’t carry interest if paid on time, but consumers can end up buying more than they planned,” said Laura Udis, a program manager at the bureau. In December, the Consumer Financial Protection Bureau opened an inquiry into these programs, expressing concern that people could accumulate debt with multiple purchases. But buy now, pay later programs seem intended to make people perceive a product to be cheaper than it truly is and lose control of their spending, critics said.
The rule of thumb for financial security is to be aware of your budget and in control of your spending, personal finance experts said. While the financing programs offer upsides like interest-free payments, there are potential dangers. This month, Apple announced that it would offer a similar program. Afterpay, which Square acquired for $29 billion in 2020, spawned copycats, including Affirm, Klarna and Fingerhut. Throughout the pandemic, as people hunkered down at home and sought to fill voids with material possessions, installment payment plans gained traction. This friction-free option to pay off items in chunks - called “ buy now, pay later” - was popularized by Afterpay, a financial tech firm based in Australia and founded in 2014. The best part: She could get the items before finishing the payments, and she was not on the hook for paying interest. That way, a $50 T-shirt shrank to a $12.50 payment a $130 pair of leggings was a mere $32.50. After entering a few pieces of information, she could buy the clothing in four installments spread over six weeks. Cole, 33, saw an enticing option to pay for her purchases. She browsed Lululemon’s website for trendy athletic apparel like T-shirts and leggings for $50 to $130. In the summer of 2020, amid fear and uncertainty over the pandemic, Amber Cole of Colorado Springs turned to retail therapy.
0 kommentar(er)
