While usage appears to be going down, Buy Now, Pay Later (BNPL) apps have maintained popularity among shoppers across the globe.
For context, a BNPL app allows one to receive an item, and then pay it off through payment installments. Unlike credit cards, these apps generally do not charge interest for their services.
These apps have long been controversial. Earlier this year, a mortgage lender went viral and sparked discussion after warning that those considering buying a home should be careful when using BNPL apps. Now, another user on TikTok is voicing their concerns about BNPL apps.
In a video with over 696,000 views as of Sunday, TikTok user Datura Jonez (@daturajonez) notes that many BNPL services are available on Expedia. She specifically cites AfterPay, which partnered with Expedia in November of last year.
“AfterPay is getting out of hand,” she says. “Once I pay off this little purchase, I am deleting the whole entire app.”
@daturajonez Everybody bout to be up in Miami #afterpay #debt #klarna #recession #inflation ♬ original sound – Datura Jonez
As the video continues, Jonez explains that the danger of these apps is that customers may be tempted to make impulse purchases they would not otherwise make if BNPL wasn’t an option.
“You can pay monthly now on anything that’s over $400, and Expedia is on the list now,” she states. “So you could do a thousand dollar vacation and pay for it a hundred dollars a month, and I think it doesn’t have any interest…You know how dangerous that is?”
Jonez notes that, while she has issues with the idea, there are some instances where BNPL on travel may be helpful.
“I think this is gonna be good if you’re in a situation where you have to go see family,” she explains. “But you know how many people are going to abuse that?”
“Y’all, don’t get into any more debt than you need to,” she summarizes. “These debt collectors, they have no soul.”
The Consumer Financial Protection Bureau (CFPB) has previously warned about the possibility of “debt accumulation and overextension” from using BNPL services, writing, “Buy Now, Pay Later is engineered to encourage consumers to purchase more and borrow more. As a result, borrowers can easily end up taking out several loans within a short time frame at multiple lenders or Buy Now, Pay Later debts may have effects on other debts.”
However, it should be noted that a comparable danger exists with credit cards, as the CFPB explained in another post. “Nearly one-tenth of credit card users find themselves in ‘persistent debt’ where they are charged more in interest and fees each year than they pay toward the principal—a pattern that could become increasingly difficult for some consumers to escape,” the site reads.
In an email to the Daily Dot, Jonez’s admitted that while these apps can benefit folks facing challenging financial circumstances and afford customers luxuries, “the frequency at which these apps are being used is indicative of our current economic crisis.”
“My concern is that individuals lacking financial literacy may find themselves trapped in a cycle of debt for non-necessities, which could have a detrimental impact on their overall financial health,” Jonez wrote. “Especially their credit. I urge everyone to learn about financial literacy as much as possible before using these services, especially during these uncertain economic times.”
In the comments section of Jonez’s TikTok, users shared their thoughts on BNPL. Some warned about potential dangers.
“Once it started being an option for groceries, everyone should’ve packed it up IMMEDIATELY,” wrote a user.
“I am in distress. I am fighting the urge to book a flight for the weekend,” added another.
“The amount of times I’ll do a paypal 4 purchase on a treat so it equals 4 little treats is unhealthy,” stated a third.
However, others cited positive experiences with BNPL apps.
“Afterpay is how I’m doing Christmas for my kids this year!” a user said.
“I’m using Afterpay for my honeymoon,” shared a second. “And don’t care lol never been late on a payment I love Afterpay.”
“It’s a very dangerous slippery slope but I think if you’re smart about it and budget well , it’s really useful,” explained a commenter.
The Daily Dot reached out to Expedia and AfterPay via email.