The buy-now pay-later company sharks


ART BY ANNIE LIANG

By JULIA ALFARO

STAFF WRITER


“Hmm...50 dollars seems awfully expensive for a skirt- wait, I can pay for this in monthly payments of $12.50? That does not seem so bad, I think I’ll buy it!”

Many young consumers today often find themselves in this exact situation when online shopping. They either see something that they like online with a steep price tag, or add several lower priced items into their carts and find their total to be hundreds of dollars. Just a couple of years ago, this high price tag would be enough to scare away young consumers. Today, however, buy now pay later companies like Afterpay, Klarna and Sezzle allow consumers to pay for their items with a small down payment, followed by an interest-free monthly payment.

Although such companies conveinently allow Millenial and Gen Z consumers to purchase items that they otherwise could not have afforded at a given moment, they also encourage vulnerable customers to be less careful about spending their money on frivolous things and get them accustomed to spending money they do not have, which can eventually lead to mountains of debt over stuff they will not use.

When people make purchases online, especially those with little financial experience, they often do not truly consider how much money they are actually spending, because money can easily be thought of as just a series of numbers on a screen as opposed to the cold hard cash you can hold in your hands. When you shop with cash at a brick and mortar store, you can physically feel your wallet getting lighter as you hand your bills over to the cashier, which makes you truly understand how much that item costs.

Nevertheless, consumers lose touch of this when shopping online; they often lose the critical eye they once had when buying products, and no longer consider things like the quality, usefulness, or even necessity of an item.

This lack of perspective leaves online shoppers vulnerable to overspending on items that they do not need, and when companies offer the ability to pay off items in small increments, consumers will end up spending even more money without realizing it.

Additionally, when allowing consumers to purchase items immediately, people miss out on experiencing the hard work and anticipation it takes to be able to afford an expensive item.

Consequently, this results in a lack of appreciation for the good they have. When someone is able to purchase items without heavy consideration, as the buy now aspect of these companies allow, they begin to not value the items they buy as much. Thus, they may not use these goods as often and quickly become bored of them, and move on to purchase something new, which creates an endless cycle of wasteful consumerism.

However, these companies do provide the convenience to pay for goods in timely situations, such as purchasing a gift on a short notice. Nevertheless, buy now pay later companies should not be marketed as a quick fix to be used at one’s disposal, like they currently are on many upscale clothing sites targeted at younger audiences. Customers should know to only use these companies when they know they will be able to comfortably afford the item later, and to not come to rely on such companies for all of their purchases.

Given this, consumers need to truly consider the cost of items before clicking “submit order” in order to ensure good shopping and financial habits. It turns out that spending 50 dollars on a skirt is just that, no matter how you slice it, pun intended.