The “Buy Now, Pay Later” (BNLP) transaction is simple: Shoppers are offered an installment loan at the point of purchase, spreading the cost of the product across several payments. They’re often available without a credit check.
BNLP financing has become a go-to payment method at most major retailers for everything from clothing and cosmetics to computers and patio furniture. Now, it’s gaining traction for an even bigger expense: higher education.
BNLP is an appealing, flexible financing concept, but customers who can’t keep up with payments can end up with late charges or interest they can’t afford. Just as BNLP can be a debt trap for the wrong shopper, education and consumer advocates fear that “Learn Now, Pay Later” could be a similar pitfall for students—and often with much higher stakes….