Business

Buy-Pay Now-Debt Bubble Over £ 4 Billion Later

UK Consumers Debt Over £ 4 Billion Buy now and pay after (BNPL) Service, according to a new survey.

Each of the 8 million BNPL customers in the UK has an average outstanding balance of £ 538 million (a total of £ 4.14 billion). The debt bubble is expected to grow further this Christmas, as 31% of people plan to shop using the BNPL service, according to a credit karma survey of smart money platforms.

BNPL continues to grow despite industry experts and government concerns, and according to a survey, providers gained an additional 1.6 million customers in 2021, for a total of 11.6 million active UK Acquired customers.

Which is the consumer group? Customers said they were “attacked” by the largest retailers on the BNPL scheme and often lacked information or warnings about late fees and debt risks.

“I’m very worried about seeing such huge debts associated with these schemes,” said Gareth Shaw, who is responsible for the funding. Said. “This shows why there are no further delays in BNPL regulatory planning, including significant marketing transparency, information on the risk of omissions, and allowing consumers to use BNPL providers. Includes credit check before being done. “

According to a Credit Karma report, nearly half (45%) of BNPL’s customers admit that they are late for payment, resulting in a lower credit score and one-third of those who are late for payment. I think nearby was rejected. Mortgage after missing a repayment.

By the beginning of October this year, according to a Credit Karma survey, British people were spending £ 5.79 billion through BNPL, of which £ 4.12 billion was unpaid.

Buy now and pay to later providers such as Clarna And Clearpay are common in online checkouts for major retailers, including: JD Sports, ASOS When Boohoo..

Klarna argued against Credit Karma’s findings. “Our average outstanding balance is £ 48, which limits our use of the service if we miss payments to stop the increase in debt,” a spokeswoman for the group said.

NS Ministry of Finance Earlier this month, we announced that there would be talks on BNPL regulation. Citizen’s Advice, a charity of advice and information, states that BNPL is “quicksand-slippery and very difficult to get out of.”

“Payments in installments are offered as a temptation at checkout, but the consequences can be devastating to those who are most difficult to deal with,” said Citizen’s Advice Policy Director. Matthew Upton said. “More than half of the young people who used BNPL last year struggled to repay. The BNPL sector is growing incredibly fast and needs consumer protection to keep pace.”

Ziad El Baba, General Manager of Credit Karma, said:

Buy-Pay Now-Debt Bubble Over £ 4 Billion Later

Source link Buy-Pay Now-Debt Bubble Over £ 4 Billion Later

Back to top button