A recent survey by Morning Consult reveals that Buy Now Pay Later (BNPL) users are experiencing growing financial challenges and rising debt levels.
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More than 40% of BNPL users carry this type of debt, with 25% admitting to missing payments within the past month.
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One-quarter of users have incurred late fees, 27% witnessed a decline in their credit scores, and 22% have interacted with debt collectors.
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BNPL attracts younger generations, with 37% of Gen Z and 32% of millennials making BNPL purchases in August.
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Wealthier individuals tend to utilize BNPL more frequently, with 21% of households earning $50,000-$99,999 and 28% of those earning over $100,000 using these services.
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BNPL users are often tech-savvy and less satisfied with traditional financial institutions.
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A significant number of users reside in households with high levels of various debts, and 33% use credit cards to pay off BNPL loans.
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BNPL enthusiasts are twice as likely to apply for new credit cards compared to the average population.
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The credit scores of BNPL users are, on average, 50 points lower than non-users, according to research from the Philadelphia Federal Reserve.
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While BNPL may seem convenient, late fees and a lack of consumer protections may place users on the precipice of a severe financial downturn, prompting the need for
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