Buy Now Pay Later

The trending financial magic trick — Buy Now, Pay Later. Buy products immediately and defer payments through interest-free instalments with BNPL, usually over a few weeks or months.

BNPL has surged in popularity, especially among younger shoppers seeking flexibility without traditional credit card commitments. However, while the system offers convenience, it also raises concerns about overspending and financial overextension. 

Let’s understand how ‘Pay it later’ works and its impact on consumer debt and credit health.

Buy Now Pay Later — How Does It Work?

Fill Your Cart & Seal the Deal – ‘Shop and Checkout’ 🛒

The fun part — Shopping! It’s always exciting, isn’t it? 🛍️

But hold on! Is your cart overflowing with items? Can’t discard them?

No worries! Pay in instalments with the ‘Purchase Now Pay Later’ feature.

Yes, you heard it right. Make big purchases and pay in easy instalments. Let’s see how:

STEPS

Budget-Friendly Button Awaits — ‘Locate Buy Now Pay Later’ 💯

As soon as you land on the checkout screen, payment methods will appear.

Select the BNPL option and choose the source through which you wish to pay.

Just a Quick Formality — ‘Fill the Application’ 💻

You will be taken to an application form. Provide your basic details such as —

• Name
• Contact Number
• Date of Birth and more 

Instant Green Signal — ‘Get Approval’ 🚦

Post this, your provider will run a soft credit score check to know your repayment capability. If everything turns out to be positive, your application will get instant approval.

Set It, Forget It — ‘Auto-Pay Set Up’ 😀

Yaay! 🎉You’ve successfully registered. Now, simply enable the option for auto-pay.

That’s it! Instalment amount will get automatically deducted.

‘Purchase Now Pay Later’ — Key Features

What perks do you get on choosing BNPL? 

Let’s find out —

Purchase Convenience

✨This feature makes your big purchases easy

Flexible Payment Options

✨You get a flexible tenure to pay off the entire amount

Easy Usage

✨The BNPL process and approval is instant with minimum documentation

Low Interest Rate

✨Enjoy zero or low interest rates, depending on the chosen provider

Pro Tip To improve your chances of BNPL loan approval, start with a small purchase and repay it on time. This demonstrates responsible borrowing and can help you qualify for larger loans in the future.

Do You Know the Risks Associated with BNPL?

Is ‘Buy Now Pay Later’ a wise choice? 🤔

Mostly, it is. However, it also depends on how you use it.

Here are some risks involved with using the ‘Order Now Pay Later’ payment method —

Overspending: The Shopping Sidekick

BNPL, the splitting payment system makes expensive items seem more affordable. You happen to buy things you might not need. It's easy to lose track of multiple instalment plans, and before you know it, your budget is stretched thin.

💡Remember, just because you can delay payment doesn't mean you’ll mismanage your finances.

Late Payments: The Trouble

Missing an instalment payment isn't just a minor slip — it may lead to a cascade of financial consequences. For instance, late fees are charged. 

Moreover, some providers may report missed payments to credit bureaus, eventually impacting your credit Score.

💡It's crucial to stay vigilant with payment schedules to avoid these pitfalls.

Issues with Refunds and Returns: The Reimbursement Riddle

Returning items purchased via ‘Purchase Now Pay Later’ can be a complex process. Unlike credit cards, which mostly have streamlined dispute resolution, this feature involves coordinating between the retailer and the service provider to process a return. This, in turn, can lead to delays and confusion.

💡 Understanding the return policies of both the retailer and the BNPL service is essential before making a purchase.

Top BNPL Apps in Dubai, UAE 

Tabled below is a list of some of the best Purchase Now Pay Later apps, widely used in the UAE:

Bottom Line

Buy Now, Pay Later has revolutionised the shopping experience. It has made it quite easy to own what you want without worrying about the payment, especially with big purchases. Yet, this convenience comes with a pitfall: the potential for accumulating debt without immediate awareness. 

As this feature becomes more ingrained in consumer behavior, having financial literacy is crucial. Understanding the terms, staying within budget, and ensuring timely payments can make ‘Pay it later’ a useful tool rather than a financial risk.