Good Reasons to Resist BNPL

Propelled by inflation and the pandemic-driven convenience of online shopping, buy now, pay later (BNPL) services have become as commonplace as hand sanitizer in a shop entryway.

-  EMMA PATCH

Since 2018, the number of BNPL users in the U.S. has grown by more than 300% per year, according to a 2021 report by Accenture, a financial consulting and information technology firm. As the popularity of these programs has increased, fintech companies of all kinds have introduced BNPL products.

How it works. When you make a purchase using BNPL, a third party offers you a loan at checkout to cover your purchase, in some cases with no interest or additional fees. The list of BNPL independent providers runs long, many with unsubtle names such as Zip and Zilch. Affirm, one of the early BNPL players, went public in January 2021. In early February, Square parent Block acquired Australian-based BNPL service Afterpay. BNPL is popping up everywhere, from travel providers to cryptocurrency marketplaces. Several credit card providers are adding interest-free, pay-later options for certain large transactions.