"The Hidden Costs of 'Buy Now, Pay Later': Navigating Phantom Debt and Alternatives"

Americans are increasingly using "buy now, pay later" (BNPL) loans, which are not as easily tracked as credit card debt, leading to a rise in "phantom debt." This type of debt is concerning because it may not be fully accounted for in traditional measures of household debt. BNPL loans, while offering interest-free installments, can lead to consumers taking on more debt than they can handle, especially with the potential for late fees and interest charges. The Consumer Financial Protection Bureau is investigating BNPL lenders due to concerns over consumer debt accumulation and the lack of regulatory oversight compared to credit cards.