You’ve completed your online shopping and are now checking out your virtual cart – you notice the holiday shopping or random splurge has really racked up the costs.

You’re intrigued by a new payment option – buy now, and pay over time!

There’s a new trend for shoppers to use a buy now, pay later (BNPL) plan. Companies like Affirm, Klarna, and Sezzle are commonly integrated into the checkout process for customers to choose as the final form of payment, allowing you to pay over time without interest.

As retailers from the likes of Amazon to small, local boutiques are including these services as a payment option, consumers are embracing this new way of spending. By 2024, BNPL services are expected to nearly triple to 4.8% of sales, accounting for $79.7 billion. Jenna Kellett, a BNPL fan and consumer, says she thinks of it as a credit card without interest.

If you haven’t looked into this new payment trend yet, here are the main pros and cons you should know:

Pros:

• Ability to purchase an item you need before financing.
• Convenient – many businesses have a BNPL integration at checkout.
• Most don’t charge interest on your payments.
• Automatic payments over time to complete your purchase.
• Easy to set up with your information.

Cons:

• May not have the same buyer protections as your credit card company. For example, if the item is faulty or if you run into a scam company, you may be stuck with the costs.
• Expensive late fees.
• Returning items may become even more complicated or made impossible.
• BNPL can’t build credit, and in some cases, reflect poorly on credit score – read more here.

The option to buy now, pay later is becoming more popular than ever. As you start to see these services available throughout your daily shopping routine, keep in mind that while interest-free payments could be more convenient, you need to make sure your payments are on time and know their buyer protection terms.

To help others understand what they need to know before purchasing with BNPL, share this article!