Is buy now, pay later a sustainable business model? | FT Tech

Pandemic lockdowns accelerated the already growing popularity of buy now pay later transactions. But for the operators behind these transactions, margins are wafer thin. So how sustainable is the business model?
#buynowpaylater #retail
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[@mufasaiam7794]

Sounds like a fancy word for Debt

[@PerpetualPreponderer]

which is itself a fancy word for Slavery

[@sebastian.v2]

Save Now, Buy Later 👌 This stuff gets dangerous when people resort to BNPL as a last resort.

[@nsp477]

Pay when you buy; buy when you have the cash. If you don't have the cash, don't buy. It will make your life much easier.

[@mathemat3939]

Why would I? I just charge on my credit card and pay in full at the end of the month. I average 60k a month this year in expenses. I get so many points! It is free money for me.

[@wilmaterna4667]

@@mathemat3939 thanks to people like you, everything is getting more expensive! There is no free money.... use your brain

[@mathemat3939]

@@wilmaterna4667 Uhhh I pay off my credit card in whole. Meaning I am not really creating new money. Use your brain. I am actually a doctorate. This is very basic logic...

[@vydg9400]

Yea people know that. But they're using it for the basic necessities now like grocery

[@chinyeakaezeugwa3520]

REST

[@frankcooke1692]

I racked up $1000, i only have to pay back $40 per month, which I can then immediately spend again, so really It's only costing me the $8 monthly account fee. If I just kept doing that - they don't see a return for about 12 years. And I know that a lot of people do the same. That's not sustainable - but that makes me wonder what tricks they have up their sleeve to make it sustainable later down the track. They make some sacrifices early on to gain market share - once they've got that, they jack up the prices. Just like Netflix and UberEats - except I can opt out of those.

[@keewng]

BNPL tempting! Missed one payment you are knackered with rising costs of living your credit card max'! You are "Double Whammied"

[@Alan-Aus]

I like ZIP, so much easier to use and the people are friendly to talk to

[@TalwinderDhillonTravels]

Does having an app make you a tech company?? That’s what they keep on referring to these companies as. Chase bank also has an app too🤷🏽‍♂️

[@notKhalid]

BNPL has already been in use since decades in India in the B2B space used by retailers(small businesses) to pay off suppliers in installments 😂

[@shereeb3463]

So why are people mad about BNPL when there are credit cards…the thing is it’s gives people who the banks don’t approve and option that’s why the there’s push back. Banks are fearful about this because they are profiting from people who they have locked out and don’t want anyone else to serve. Most please can make payments. How many people are swimming in credit card debt? I guess that is ok as long a big banks are doing it

[@Shay416]

my biggest concern it it's ability to hit the vulnerable sector the heaviest. The video mentioned people using it for basics (food & medicine), that's alarming. If even 1 in 5 American use this, and a portion of those default, you create a new poverty class

[@hjsti7869]

the way these services work is like a fail safe so you dont get poteniacly scammed. its a get now pay after thing. you still need to afford the product without loans.

[@warrentoles3127]

So it's financing

[@hjsti7869]

@@warrentoles3127 not really. you can pay the full amount on the due date of the bill.

[@williamhaynes7089]

@@hjsti7869 - but if you dont, that 0% becomes 29,97% from day 1

[@iceman4660]

That Klarna guy made me chuckle. There only concern is profit. The issue is BNPL doesn't, as yet, check the financial well being of persons using its service. The supply chain B2B idea sounds just like Geenshill. An attempt to repackage something that isn't fancy

[@thechosenone1533]

Sounds like a fancy term for credit cards.

[@sandimfeka]

Zero interest

[@kwektans]

Nice name for loan sharks. Useful when interest rates are low but bankrupting when rates are high.

[@errorerror6918]

Except they don't charge interest

[@williamhaynes7089]

@errorerror6918 is the same as cash if you pay on time.. only if you go into default are there interest fees to the customer. The business you bought stuff from pays a fee.

[@TSquared2001]

Sounds like credit cards, which will eventually equal debit.

[@mattcgw]

Well they don't charge interest. Whilst many other retailers charge 25%.

[@lardyman2]

They don't charge interest*... *if you pay it back. That's the big issue, it should be fine for the responsible borrower, Not to mention that the debt is outsourced to rather unscrupulous debt collection agencies.

[@iceman4660]

@@lardyman2 in addition they get paid by the retailer so don't need to worry about the interest payment

[@alihassanmirza5768]

Apple Pay Later will boost BNPL

[@preciousone9377]

Didn’t know Apple had this feature.

[@_orodrigofernandes]

Did anyone ever visited Brazil?? Lol. BNPL is the norm around here for decades. You can buy clothes, appliances, cars... and spread the payment in instalments. Even football clubs spread the payments of players' transfer fees over many years... There's a thing called cashflow that I hope FT knew a bit about. LOL. Besides this BNPL, any company can borrow money from a bank or financial instituion to improve their cash reserves... I didn't get what's the novelty...

[@leocordeiro81]

Is this a Joke? Other countries have been doing that for over 30 years, and you guys only discover this now?🤦

[@luffirton]

Exactly 😅 I was very surprised.

[@ZacandDora]

The Instagram of banking is guff. What nonsense. Bank apps work fine. This piece misses the point about how BNPL can help people.

[@arifulislamleeton]

Introduce myself my name is Ariful Islam leeton I'm software engineer and software development and website development

[@mack-uv6gn]

Danger! Will Robinson! Danger!

[@williamhaynes7089]

with intrest rates going way up, their profit is way down

[@zico739]

Literally Layaway.

[@SavingsMinusDebt]

BNPL only deal with high risk customers.

[@jw999]

Buy now... Never pay... Gee, wonder what could go wrong...

[@gigamesh780]

With younger generation being more impulsive than before since education is more about "connect with your emotion" and less about "discipline at all cost from the 70's", Younger people will be more enslaved to their debt than ever before with this systeme. Teach your sons how to navigate before this model start to take more impact

[@riddhimaansenapati5006]

Do you have any evidence for that? Besides discipline at all costs didn't work and connecting with emotions teaches you how to manage them. You don't make your emotions go away by beating yourself with a stick. The reason why this is happening is due to drop in disposable income due to inflation and weak wage growth. Thus forcing people on debt. In the 70s you had good wage growth 📈 which helped people to avoid debt. And younger people are aware of debt they just don't have any other options most of the time.

[@wernerlippert5499]

BNPL: Buy things you don't Need wit money you don't own to impress People you don't Like

[@minimumtrade]

Bottom feeders

[@Ken_from_Mumbai]

It’s a ponzi 😊

[@dawidwtorek]

BNPL is a totally useless concept. The only things you should allow yourself to be using credit on are real estate and investing. Period. If you cannot afford something than do not buy it.

[@riddhimaansenapati5006]

Unless you really need it like heating for many people.

[@bla7091]

not even investing I think, why would you be paying 20% or more on interest to fund your investments? Got any investments that reliably return more than that?

[@greenthunder7982]

@@bla7091 there are ways of borrowing money to invest at less than 20% interest such as margin.

[@bla7091]

@@greenthunder7982 I kinda ruled that out as it's so risky. Works well a lot of the times but when there are losses, they are truly enormous and just wipe you out...

[@za7529]

Umm no it's not.

[@StockTracker1]

No.

[@vydg9400]

Americans getting poorer

[@WallaseyanTube]

More shoddy left-wing journalism; I will not watch any more of this.

[@TSquared2001]

And you concluded this how?

[@WallaseyanTube]

@@TSquared2001 How would you conclude otherwise?

[@wryterzblock]

​@@WallaseyanTube Intelligent explanation. 😂