If consumers hadn’t been exposed to BNPL financing before the 2021 holiday season, they likely encountered such offers on Black Friday, Cyber Monday and every other recent shopping day. Going forward, they’ll face even more exposure as Klarna, PayPal, Afterpay, Affirm and other fintech companies that propelled BNPL to its current high-profile position add more merchants. Several big card issuers have already launched their own versions of BNPL, adding more fuel to one of the hottest financial product categories.

Between March 2020 and June 2021, the consumer user base for BNPL grew a staggering 85%, according to PYMNTS.com. As with most fintech innovations, younger consumers tried BNPL first and older generations followed.

BNPL undoubtedly represents a financial boon to everyone on the selling side of the aisle. The benefit from the buyer’s perspective is less certain, and consumer misunderstanding about how BNPL works compounds this uncertainty. For that and other reasons, the Consumer Financial Protection Bureau opened an inquiry into the risks that BNPL poses to consumers.

Check out Kathleen’s full article published on thefinancialbrand.com