From Yahoo Finance: 2025-06-09 10:48:00

Buy now pay later users are facing increased credit losses, with 41% paying late at least once in the past year. Klarna reported a 17% rise in consumer credit losses in the first three months of the year. Advisers warn younger users that BNPL could impact their financial future negatively.

BNPL is seen as a bridge to the next paycheck for a third of users, with clothing, technology, and home décor being common purchases. The average purchase amount is $142, with 63% of users having multiple BNPL loans. Groceries saw an increase in BNPL usage amid rising prices.

BNPL users may face a hit to their credit score if they miss payments, limiting future borrowing opportunities. Payment history is usually not reported to major credit bureaus, but a failure to repay may be reported by a debt collector. BNPL companies can restrict future use for non-payment.

Financial advisers caution against using BNPL for non-essential purchases, emphasizing the importance of budgeting and financial planning. Fixed-rate personal loans are recommended for consolidating debt or covering major expenses, providing predictable payments and lower interest rates. Responsible use of personal loans can help build credit history.

USA TODAY reporter Medora Lee highlights the potential impact of BNPL on users’ financial future. Advisers stress the importance of budgeting, repayment planning, and exploring all options before borrowing money. Responsible use of personal loans is encouraged for building credit and managing debt effectively.



Read more at Yahoo Finance: Why ‘Buy Now Pay Later’ could be wrecking your financial future