Focus at Four: Buy now, pay later gains traction on retail websites
BRYAN, Texas (KBTX) – Buy now, pay later (BNPL) programs have been rapidly growing as a payment method for many consumers.
Companies like Afterpay, Affirm, and Klarna have gained popularity as options on some major retail websites.
Liz Pagel, Senior Vice President of Consumer Lending for TransUnion, joined First News at Four on Thursday to discuss this sometimes too-good-to-be-true system.
Pagel explained to KBTX how BNPL is popular, and there are more options to use it than ever.
“We just did a survey of consumers across the US who have used it and have not used the product, and 89% of the consumers that use it like it. They’re satisfied or very satisfied with the product, which is really high numbers. So, this is something that is poised to continue to be an everyday mainstream financial product,” Pagel boasted.
Through the average BNPKL program, the merchant actually pays the lenders.
“If you’re shopping at Target or anywhere else, they pay the lender a little bit of money for allowing you to finance the product because the merchant gets the benefit of a higher checkout rate when consumers have that option at checkout,” said Pagel.
Pagel did give caution to consumers and advised them to ensure that it still fit into their basic budget.
“Like with any credit product you are taking out, an albeit short, loan. So, you really have to make sure you can make those payments. If you’re going to finance a purchase, you want to make sure that you understand when those payments are going to be due. Make sure you can pay them and make sure you can still pay all your other obligations,” Pagel added.
