The 'Buy Now, Pay Later' Bubble Is About to Burst

Re:The 'Buy Now, Pay Later' Bubble Is About to Burst by alexjplant on Friday January 13, 2023 @10:00AM (#34368612)

I always see articles like this and wonder what the big deal is... I frequently use PayPal Credit, store credit cards, and Affirm on larger purchases because I like being that much more liquid. Then I realize that I always use the 0% APR option and that I've paid exactly $0 of interest to all of these services. I couldn't imagine paying 12% APR for the privilege of owning a $1400 synthesizer much less for a delivery order of sandwiches at a house party (as mentioned elsewhere in this thread).

Side question: how are these services able to offer lower APRs than credit cards without collateral? Do they evaluate your creditworthiness on the basis of paying equal installments as opposed to revolving credit with a minimum payment? If so then how are they different from an old-fashioned personal loan from a bank?

[ Parent | on HN ]

Re:The 'Buy Now, Pay Later' Bubble Is About to Burst by jerf on Friday January 13, 2023 @10:09AM (#34368743)

"I like being that much more liquid"

There's "I use debt to buy things I can't afford", there's "I don't use debt to buy things I can't afford", and then there's "Yeah, I could totally drop cash on this but I'm going to take 0% debt just to avoid the liquid drain". If you're in that third category, you're just too far away from the first one to understand it very well. (In self discipline, not income. There's no amount of income itself that keeps you out of that first category!)

[ Parent | on HN ]

Re:The 'Buy Now, Pay Later' Bubble Is About to Burst by nradov on Friday January 13, 2023 @11:02AM (#34369626)

These services are able to offer lower APRs than credit cards by charging higher fees to retailers.

[ Parent | on HN ]