The Rising Risk of Buy Now, Pay Later: Fueling Holiday Debt

The popularity of "Buy Now, Pay Later" (BNPL) services is surging as consumers seek alternatives to credit cards and fear of debt. While some users turn to BNPL out of necessity, many see it as a complement or alternative to credit cards. BNPL spending has increased significantly, with major credit card companies also offering their own versions. The appeal of BNPL lies in its simplicity and the ability to manage cash flows more efficiently. However, there are concerns about overspending and potential financial stress, as BNPL users are more likely to have other high-interest debts. Credit agencies are working on standards to reflect BNPL behavior on credit scores.