The Buy Now Pay Later Takeover | Fake Money
2/19/202641 min
In the 2010s, FinTech companies emerged offering a Buy Now, Pay Later service that made financing available, at a time when trust in big banks was low. But as dependence on these apps grows, consumers are starting to reassess the cost. Adam Clark Estes is a Senior Technology Correspondent for Vox — he’s sharing what can happen when customers over-rely these services. Later, Annie Joy Williams, an assistant editor at The Atlantic, explains why women are becoming the biggest target demographic for Buy Now, Pay Later apps, and the consequences Gen Z consumers may face.
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First 90 secondsDavid Brown· Host0:00
[upbeat music] I'm David Brown, and this is Business Wars. [upbeat music] Buy now, pay later services have reshaped the way we purchase things. They've turned big-ticket items into little treats. Instead of throwing that new jacket on a credit card, you can make four small interest-free payments, and that's not debt, that's a budgeting hack. [chuckles] Yeah, right. These payments may be minor. They may seem small at first, but the debt can really start to snowball. More than sixty percent of buy now, pay later customers have multiple loans out at once. Luxury purchases are still the most common application, but a growing number of people are also using these apps to fund necessities like groceries and medical bills, as prices for everyday goods continue to climb. And now the credit scoring company FICO has announced that it will factor buy now, pay later loans into its models. That could have big consequences for regular users of those apps who might have considered them safer than credit cards.