After adding a few too many items to your online shopping cart, you head over to the payment page to check out. Alongside the usual credit card and PayPal payment fields, you see an enticing new option. A colourful button offers to allow you to spread your payment over several months at 0% interest. This would lessen the immediate dent a payment to ASOS, Shein or H&M might make on your bank balance, and allow you to purchase all the items in your bag.
Buy now, pay later (BNPL) services are now readily available with thousands of online retailers. Nearly 17 million consumers in the UK have used BNPL services like Klarna and Clearpay. BNPL companies offer a period of interest-free credit (usually several months). They typically levy late fees if this time frame is exceeded, and pass it on to debt collectors if the repayment is repeatedly missed.
