Buy now, pay later schemes are starting to allow people to purchase items even if they don’t have the full amount on hand, but in spite of the fact that this is the case they can also be a path to financial ruination if one is not careful. Users are often unaware of the high rates of interest that they are accruing which is dangerous because of the fact that this is the sort of thing that could potentially end up leaving them greatly in debt.
With all of that having been said and now out of the way, it is important to note that the British financial regulatory authority known as the Financial Conduct Authority (aka FCA) for short highlighted the risky nature of ads that might misrepresent BNPL products. The products themselves are indeed closely regulated, but many users are not cognizant of how unmanageable their debt would truly be.
17 million people living in the UK have now used a BNPL option with all things having been considered and taken into account. When looking at just users who are between the ages of 20 and 29, 30% of them have used such a payment plan. The UK’s financial watchdog has highlighted the lack of warnings that influencers are putting up when advertising BNPL products, especially those that target young adults who might not know the consequences of what they are being socially engineered to do.
There should be warnings that would tell users about how debt can become hard to afford, along with clearly mentioning what would occur if a payment were to be missed. Most users are also in the dark about how this debt and its subsequent payment might impact their credit score, which his another thing that should be mentioned in ads in the form of a disclaimer.
BNPL options are becoming increasingly popular, and since they are not nearly as tightly regulated as normal banking institutions they might be able to prey on users who are not educated enough about such matters. That is why such oversight is so undoubtedly important.
Read next: Influencers Might Be More Trusted by Gen Z Than Reviews on Product Pages
With all of that having been said and now out of the way, it is important to note that the British financial regulatory authority known as the Financial Conduct Authority (aka FCA) for short highlighted the risky nature of ads that might misrepresent BNPL products. The products themselves are indeed closely regulated, but many users are not cognizant of how unmanageable their debt would truly be.
17 million people living in the UK have now used a BNPL option with all things having been considered and taken into account. When looking at just users who are between the ages of 20 and 29, 30% of them have used such a payment plan. The UK’s financial watchdog has highlighted the lack of warnings that influencers are putting up when advertising BNPL products, especially those that target young adults who might not know the consequences of what they are being socially engineered to do.
There should be warnings that would tell users about how debt can become hard to afford, along with clearly mentioning what would occur if a payment were to be missed. Most users are also in the dark about how this debt and its subsequent payment might impact their credit score, which his another thing that should be mentioned in ads in the form of a disclaimer.
BNPL options are becoming increasingly popular, and since they are not nearly as tightly regulated as normal banking institutions they might be able to prey on users who are not educated enough about such matters. That is why such oversight is so undoubtedly important.
Read next: Influencers Might Be More Trusted by Gen Z Than Reviews on Product Pages
