The buy now, pay later (BNPL) industry is now a $100 billion industry.
Who is affected🤷: Millions of people (mostly Gen Z & millennials) use BNPL to finance their purchases. In 2020, BNPL transactions accounted for more than 2% of global e-commerce transactions. That figure is expected to double by 2024. Some of the world’s largest companies are speeding to enter the booming industry, with companies like Amazon & Apple partnering up with BNPL player Affirm. PayPal is launching its own BNPL product, & Square has agreed to acquire Afterpay for $29 billion!
Why is this important🤔: BNPL is often criticized because its users can lead themselves to spend more than they can afford. This has led to BNPL companies to set “spending limits”. Although BNPL is typically interest-free, some providers charge high late payment fees. This has grown concern over consumers’ possibility to go into debt, sometimes unknowingly! Needless to say, critics of BNPL are constantly calling for the industry to be regulated to better protect consumers.
