The Sting In The Tail Of Sydney’s Love For Buy Now Pay Later
With more than 40 per cent of Sydneysiders using platforms like Afterpay, zip pay, and Klarna, the convenience of making purchases without upfront payments has become increasingly popular.
However, the federal government has recognised the need for regulatory changes to address the potential pitfalls of buy now pay later services.
Listen the full episode below to find out
On today’s episode of This Arvo In Sydney, host Sacha Barbour Gatt and LiSTNR journalist Micaela Savage discussed the potential risks of buy now and pay later service.
Savage said recent statistics revealed that the average debt among Australians using buy now pay later services was approximately $1,240, with Gen Z being the most active user group.
Traditionally none of these “buy now pay later” services have been regulated as credit products, which means they don’t need to check your credit history or anything before you sign up as a bank would,”
That’s something that they kind of use in their advertising the real people in, and they also tend to focus on this idea that you won’t need to pay interest,”
The availability of buy now pay later services in Sydney extends beyond traditional retail transactions, with options now including restaurant meals, hair appointments, and even medical prescriptions. Sydney’s money expert Sarah Megginson said the availability with Afterpay could be “dangerous”.
If you’re having to put a restaurant meal or a takeaway meal on ‘buy now pay’ later because you can’t afford to pay for it upfront. You’re paying off that meal over a number of weeks, and that’s where you start to see people get into bad habits with it.”
Savage said the new regulations would require all providers to hold an Australian credit licence, conduct credit checks, and introduce fee caps for missed payments.
These changes aim to protect consumers from accumulating excessive debt and ensure transparency in marketing practices.
Hosted by Sacha Barbour, This Arvo in Sydney is a 10 to 12 minute daily news podcast made just for Sydney! Listen now on the Listnr app.