Buy Now, Pay Later Booms But May Conceal Growing Consumer Debt
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Buy now, pay later financing has grown rapidly, with $24B in loans originated in 2021, up from $2B in 2019. Total 2023 loan value estimated at $46B.
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Lack of oversight and transparency around buy now, pay later providers means this "phantom debt" may conceal growing consumer debt problems.
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Buy now, pay later loans often don't appear on credit reports or impact scores, allowing financially vulnerable consumers to take on more debt.
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Record Cyber Week sales show buy now, pay later driving significant portion of spending - $940M on Cyber Monday alone, up 42.5% over 2022.
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Provides benefits like affordability and expanded access to credit but also comes with fees, penalties, and potential for consumers to take on excessive debt.