Americans are relying on buy-now-pay-later to make holiday purchases this year. That could spell trouble later on, experts told MarketWatch.
Shoppers checking out in stores have traditionally been offered an incentive to save on their purchase if they sign up for the store’s credit card. These days, consumers shopping online are being tempted with the option to buy merchandise now and pay for it later in a series of interest-free installment payments.
And during this holiday season so far, consumers are falling head over heels for these payment plans.
“We are doing more transactions today, in a single day, than during Klarnas first 4 years combined,” Sebastian Siemiatkowski, CEO of Klarna, a buy-now-pay-later platform, said on Twitter
on Black Friday. He added that “regularly during the day over 100 transactions per second” were made.
On a competing platform, Afterpay, consumers generated 1.2 million clicks on Black Friday as