Rise of 'phantom debt': The risks of buy now, pay later programs

Tim Quinlan, Wells Fargo senior economist and managing director, joins 'Squawk Box' to discuss the increase in 'buy now, pay later' transactions, why he believes credit racked up through these programs are hard to measure, how the 'phantom debt' could create trouble in the broader economy, and more.

[@stevezilla68]

Banks: this bothers us because we're not getting a piece of it.

[@jlf115]

buy now pay later is an amazing tool and I love it. I bnpl EVERYTHING

[@face4me2]

It sounds like you guys are mad that they have found a consumer base that the credit card company lost out on

[@Literallyarealhuman]

I don’t think so

[@jodame3925]

I find this information alluring 😊

[@Dematsa]

Great job man

[@fun-dk1ts]

Healthcare system will break down soon

[@carl2724]

I owe $1200 between Klarna and Affirm. I bought needed furniture. Affirm changed 35% interest. The only way I can lower interest is to pay it off early which is hard to do. The payments feel like garnishments to my checking account

[@jimbojimbo6873]

How is this different from any other debt?

[@Cassander314]

You can’t owe a faceless man

[@lulubelle551]

Banks are still lending

[@dgaz3057]

Go in debt now...and pay taxes on it later...

[@MangoFlamingo]

Financing your Pizza if the first step to Financial Freedom. To the moooonnnn

[@markmedley6849]

I like to pay first then getting my food because I'm hungry and it seems worth it. I don't like getting the bill after I eat and I'm full. I dread the check and don't think the meal is worth it. I hate to buy now and pay later.

[@mgh62000]

I like Klarna

[@briantep458]

how to destroy a country

[@kingjustice1831]

The whole economic system is a scheme even Ponzi would be envious of, and it’s going to implode sooner rather than later.

[@eddiekulp1241]

What are you talking about , credit cards , store credit ? Never heard of this .

[@ireneswackyjournals8810]

But credit cards own ads.

[@Alpharizzchad]

We all known that we buy now pay later ( homes cards Vacation) these are things we can handle. When the banks are cutting your credit card line you know that they are in a problem. Remember 2008. They cut every one credit card line. So hold on Stay alive until the end of 2025😅

[@ireneswackyjournals8810]

When all news cycles that have financial incentives from credit card banks due to commercials all randomly put ads against bnpl and ignore credit card debt which is years worth with annual fees of up to 30% hmmm. Seems credit cards want to get rid of the competition: because if someone can make the transaction and not get hit with the Apr from a debit payment . or they can divide the amount on the credit card to not get the apr… from a direct purchase lol

[@oscarp2629]

To all my Trump supporters, don't be silenced, don't be shamed, don't be afraid. That's what the masses want - keeping you in the shadows, keeping you quiet without a voice. Speaking up is your God-given right - use it or lose it. Stand strong 💪 stand united 🇺🇸

[@amanintrade]

You just invented a problem that doesn't exist. From credit risk perspective BNPL is no different than a traditional credit card. There are some nuanced differences in the economics between the merchant and the risk bearer, but risk is registered against the credit allocated by the issuer. The aggregate sum of this is eventually reported by companies if they are public. You literally invented a phantom problem 👻

[@ireneswackyjournals8810]

It’s a problem: to the credit cards. Imagine people splitting up debit hits on the credit cards or just going directly to the bank. The credit card can’t get the apr for all of it. Or the portion you didn’t pay in the first month

[@Anthony-dj4nd]

Just what people need, more debt!😂

[@Bitcoin_Gold]

Whenever corrupted Joe Biden advertisement comes up i.hit skip right away. LoL

[@MrNiceGuy500]

It sucks cause my real cash has to go up against this funny money, also these buy now pay later companies add on a 6% process fee to retailers it’s gonna end up in higher prices for all the more it’s used 😮

[@ireneswackyjournals8810]

Were you complaining about the 1-4% from visa to Amex surcharges? That already came into the purchase price you’ve been paying for decades

[@trashpageant7861]

Hahaha Wells Fargo guy worried about us and the financial health of us little people. That’s nice 💩

[@face4me2]

Did he just say a lot of small payments sounds like he talking about credit cards

[@Cassander314]

What is this garbagé

[@76ersALLDAY]

Joe Biden is the only one who can get us back on track! 😂