‘Buy now, pay later’ is more popular than ever. It can cost more than you think
Associated PressNEW YORK — More shoppers than ever are on track to use ‘buy now, pay later’ plans this holiday season, as the ability to spread out payments looks attractive at a time when Americans still feel the lingering effect of inflation and already have record-high credit card debt. Buy now, pay later can be particularly appealing to consumers who have low credit scores or no credit history, such as younger shoppers, because most of the companies providing the service run only soft credit checks and don’t report the loans and payment histories to the credit bureaus, unlike credit card companies. In May, the CFPB said buy now, pay later companies must adhere to other regulations that govern traditional credit, such as providing ways to demand refunds and dispute transactions. “Buy now, pay later can be an innovative tool for purchases you’re going to make anyway,” said Mark Elliott, chief customer officer at financial services company LendingClub.