product, also have been relatively more positive
about buy now, pay later since any plan would
have a beginning and end date. Most of their
worries concern any fees that might be associated
with late payments.
“These products do encourage people to pay
purchases off quicker and usually with less
interest, but if people are using them to simply
buy more than they should and getting over their
heads, paying late fees, etc., are they really helping
manage people’s expenses?” Lauren Saunders,
associate director for the National Consumer Law
Center, said.
Adobe Digital Economy Index, which analyzes
direct consumer transactions online. said revenue
on Cyber Monday from buy now, pay later plans
rose 21% from a year ago.
Buy now, pay later is not a new product —
services or products such as layaway, monthly
payments on large purchases and even retail
credit cards have existed for decades. What’s
different is how it’s being offered, and who is
offering the service.
Instead of telling a customer to apply for a store-
branded credit card, which often can only be
used at that one retailer, companies have added
financing options provided through third-party
companies such as Affirm, Afterpay or PayPal at
their online checkout.
There are typically two different types of buy now,
pay later services: the short-term payment plans
that break a purchase up into four or six bi-weekly
payments, and the longer-term installment loan-
like products that Affirm offers.
PayPal co-founder Max Levchin started Affirm in
- The $32 billion company went public this