With everything now offered with Buy now Pay Later including a $20 dinner , where is this really leading to ?
And now all major banks also jumping into BNPL, Is this a plan to make almost every Aussie owing a debt ?
May be you buy $1 7-11 coffee and pay it in 4 instalments of 25c
đź’µ flows up from the poor at the bottom to the rich.
The "rich" spent their $ in Capital (assets and into things with ROI) and Operating Expense.
The "poor" spent their $ in Operating Expense into services/product build by the rich.
The ethical problem is, should companies be allowed to set "vulnerable" up people to fail.
No one is forcing you to do it.
Easy to say until you're desperate to feed yourself / kids / parents / someone. Especially if you lack financial education.
What? Do you think everyone is as fortunate to have a education, parent(s) or experience(s) to learn how to deal with finances?
The fact that you can say it casually means you're luckier than a lot of people. I hope it does not mean you're against "regulating stupidity" because until we have good education on it, you're laughing at the people who are getting exploited/slaughtered by evil smart people who prey on desperate people.
Don't blame financial innovation for your lack of financial literacy lol
Get financial literated, will help you lots in the long run trust me
BNPL isn't financial innovation.
It's traditional finance dressed up in skirts and lipstick to avoid a credit licence.
Thats yo problem bra
Way to take a dump on our country…
Makes me sick as an Australian to hear people complaining about being “poor” in this country.
It’s not like a medical emergency will send you bankrupt. We have welfare as a lifeline if you lose your job. Minimum wage is livable, you just have to compromise - something that seems beyond most people.
I’ve also noticed a lot of “poor” people have a better phone than me, so they should have no problem connecting to the internet with their 150/per month phone plan to find additional ways to make extra income. There’s plenty of them.
Way to take a dump on our country…
I wasn't but… God bless Australia for paying more to private education than public education!
It’s not like a medical emergency will send you bankrupt.
Yes..? Should we never complain because we can never go bankrupt?
We have welfare as a lifeline if you lose your job.
Um.. have you tried living on it? If you can! Try it with kids !
Minimum wage is livable,
Well… kind but there's inflation which apparently means we should not raise minimum wage!
I’ve also noticed a lot of “poor” people have a better phone than me,
I noticed that there's a lot of luxury cars out there too. Am I jealous I don't have one too? No, because there's such as thing as car finance. And interest rates are cheap! Ergo, I'm laughing at those with luxury cars.
@orangetrain: I was raised on welfare. It was a wonderful childhood. Always had food in my belly because this is Australia.
No, I don’t think you have the right to complain about not being bankrupt. You should be grateful for free medical care.
I haven’t lived off welfare. When I took 3 months off work because I felt like it, I funded it myself with the money I had made working like a dog. If I lost my job, I could get another instantly.
As for welfare with kids, don’t they get significantly more money for having kids? A guy I work with has a sister in law claiming single mothers pension and all 3 kids “have ADHD”. Rakes in enough per week to cover my mortgage 3x over.
I think if your poor people can’t afford kids, they shouldn’t have kids. I don’t believe in “accidents”. Plan ahead.
Inflation wasn’t as big a problem until a few months ago, so what’s your theoretical poor person’s excuse for not having money before then? I’m guessing they don’t work?
I’m not a keeping up with the Jones’s type. Your poor people generally are - the sad result of watching crap like the kardashians…
Point being the only poor people in this country are those who make poor decisions. You can play the victim, but you can’t fool me.
@orangetrain: You have car finance but seem to be very strong on your opinion of BNPL assisting people that may not have enough money to feed a family? If this is your situation, I'd strongly encourage you to look at your finances properly and what you do and don't need and what you can change so that you're either, not living above your means or increasing your means. Unless you live regional or night/shift work, a car is not a requirement and if you're using finance for a car when you can't pay for food, then you shouldn't have a car. I hope this comes across as I mean it, helpful not harsh.
We've got our 'disillusioned' One Nation voter!!
@Boogerman: I just live in the real world where people apparently still don't know how good we have it here and blame others for their own failings.
Easy to say until you're desperate to feed yourself / kids / parents / someone. Especially if you lack financial education.
BNPL doesn't increase your 'wealth', you still have the same amount of money to spend at the end of the day.
Learn to budget and BNPL services won't be needed.
Especially if they give you $10 off!
buy wife pay later?
putin enters the chat
Be careful where you putin
Isn't this the best form of debt?
There is no interest at all, pay it back on time and its free credit.
I absoluely abhor reading about how BNPL is a financial trap that should be more regulated.
Get your facts straight, BNLP is regulated since it is a form of credit. What people are talking about when they say BNPL needing more regulation is around the lack of transparency with consumer protections. There is a risk that non-BNPL customers will in the future (or maybe already are) subsidising BNPL customers. In these situations, having proper regulations makes sense as it adds transparency to the system.
Well there is is massive revenues in the late fees and that’s the point of it. Zip pay charges flat rate monthly fees plus late fees, fees fees fees.
In theory yes. The problem is that they're giving out credit to anyone that asks, even the desperate people.
Why deal with the hassle of paying a $30 meal in the future? Well, you're not the target market.
If you eat 2 $30 meals a day, 3-4 times a week it should add up to a reasonable amount for bnpl
For example, pretty normal to buy an ipad with afterpay so why should this be different
I have tried after pay and they require payments to be done.. manually in increments? Those daily $60 meals would need to be paid for each increments on each day. Forgetting to pay can incur a late penalty of $10.
Lets go with your ipad example vs meals.
iPad: A user pays $150 for a $600 ipad. They have to remember to pay back 3 installments of $150 to pay. A user forgetting all payments but paying on time means that iPad true cost is $630 or 5% increase (600 + 30).
Meals: A user pays $60 for $240 in meals for just one week (Assuming 2 x $30 x 4). They have 24(!) installments of $7.5 to pay. A user forgetting all payments but paying on time means the true cost is $420 or 75% increase (240 + 180).
The late fee is a minimum $10 as per Afterpay: https://www.afterpay.com/en-AU/terms-of-service
Forgetting or unable to do BNPL mean you could end up paying much more. A single $30 meal and you forget all installments? (3 x $10 = $30 late fees) $60 meals.
Are you SURE you have the financial literacy when you compare meals to an iPad?
@orangetrain: Afterpay send 2-3 text messages and 2-3 emails for every payment. There’s plenty of warning that it’s going to be taken out automatically. It is not something you can easily ignore.
Well anyone paying $30 for one meal, that has to buy on BNPL, should just use their own kitchen.
Are they though? I applied for both Afterpay and Zip the moment I turned 18.
Afterpay has been a really useful (free) tool for cashflow management when I’d like to buy something higher value than usual - if it weren’t for Afterpay spreading it out, it would’ve been harder for me to get nicer linen and cookware for example, which will last longer than Kmart.
Zip straight up denied my application immediately without even checking for bank statements, and they won’t let me apply again either.
After having a job for a while I’ve applied for a traditional credit card twice (with adequate spacing between applications of course) and have been declined twice, both major banks.
When I have a good job again (going to uni now) Ill probably close down Afterpay and try for a rewards credit card (with budgeting), or at least a low rate card to accomplish the same task as BNPL. But no one will give me any credit right now.
Use some self control and there isn't any problem.
credit card is really no different
where is this really leading to ?
Voluntary revenue raising.
Buy anything, regret later*
There's a reason why a random hobo on the street is not getting any home loans.
Because they’re on drugs, usually.
They wish… drugs are expensive and dat local dealer doesn't take afterpay!
I wouldn't know…
^^ somehuman says "they're on drugs" like it's a bad thing???
Sobriety is fine if you cant handle drugs, but don't force your physic limitations on me, dude
I like BNPL. I don't know if I would even consider a $20 lunch a "debt" worth even worrying about. What difference does it make if I pay $20 nor or later? And you get rewards, I think I'm a Mint level Captain with Afterpay, that's gotta count for something when society collapses.
The $20 lunch thing is strange.
I think DoorDash with Afterpay isn’t a bad idea, because now you can have a decent dinner party with friends and family and spread it out like any other (slightly higher than usual) purchase.
I don’t like that it’s DoorDash, but I suppose it makes sense.
I've avoided so far BNPL because I see it very similar to credit cards. I already put everything I can on my card and pay it off each month, so I'm hesitant to introduce yet another layer of obfuscation of debt in my life.
All the sales and specials (especially those routinely promoted on this site) are very tempting though.
Incidentally I listened to a Planet Money episode the other day on this very topic. I think the risk is definitely immense is for those who are poor at financial management, or for those who have been (rightly) declined credit cards, as the financial checks aren't as stringent. Also with so many different companies now, I can see it as a bit of a trap if people start taking out BNPL lines of credit with multiple providers then suddenly you've got debt coming out the wahzoo.
https://www.npr.org/2022/05/10/1097885472/buy-now-pay-dearly
If you have a credit card you’re not the target market, especially if you pay off your bill each month (like most should).
The target market is those carrying debit on low rate cards, or those young shoppers who might not be able to get a credit card (I certainly can’t seem to despite having a job at both applications).
Just another way to encourage consumerism and make people not clearly see ehere they are spending. People need to ask themselves the difference between this and a credit card. Anyway, in time it'll probably start incurring more fees for use, once a large number are using as the norm.
I also think it disuades people from changing their habits. Sacrifice is something we need to do sometimes in a financial sense and if BNPL is always there then why would you wait till next paycheck to get what you want, just buy it coz Yolo. Or what eat the boring food in your fridge when you can get food delivered. A bit of delayed gratification and sacrifice makes us better peeps.
I don't and i wont use it so I'm a bit biased.
I use BNPL, if and only if I get some sort of discount on the purchase. Otherwise, I see no point & just use my credit card like i have been for the past 20 years.
As jerry would say… no interest.
Just a $5 a month admin fee via GE, which is now $8.95 per month, and if you don't pay for it on time, GE slug you with 25.9% Interest.
When I initially started at HN, in the early 90s, it was 9% Interest Reducible with 1/3rd deposit, which was handled internally through HN.
Zip Money is $7.95 per month for the same kind of thing, with the bonus of not being stuck with Harvey Norman.
As long as you pay on time.
If you are stupid enough to buy something which you don't need with money you don't have, then blame yourselves for the position you are in.
BNPL is perfect if you need something and get your fixed income/salary fortnightly, in such way you can pay it off in 4 pays in parts.
But obviously you need to be careful with your finances and never spend more than your means of income.
With lot of comments , I see most of the ozbargainers are financially literate and as expected, they think only about themselves
No one thinks of normal people who are living within means ,how their life will be impacted by those BNPL companies luring them to use this even for small stuff
Only people know how some are addicted to ozb and say it is just $5 , I don’t have a need but since it is a bargain I will still buy and then throw them out even without opening the package
I see bnpl is just like gambling in casino , those who have self control could use it well and a small miss is going to cost them a fortune
No one thinks of normal people who are living within means
Even if you are living on welfare in Australia, you could live a decent life. If you are not able to make ends meet, you are doing something wrong. Don't buy stuff which is not necessary. Use electricity and gas wisely.
This reminds me of what happened just before the Great Depression.
https://letmegooglethat.com/?q=buy+now+pay+later%2C+the+grea…
đź’µ flows up from the poor at the bottom to the rich.
BNPL is another tool to make that happen.