Buy Now, Pay Later: 5 Common Mistakes to Steer Clear of When Utilizing BNPL Payment

BNPL Payment: Buy Now, Pay Later was introduced in the early 19th century when people wanted to buy items but due to lack of sufficient money, they couldn’t, it was meant to provide assistance to those people.

In the 90s many shops used store cards or private label credit cards that allowed the shop to work with a different bank to handle the card program for the business which marked the beginning of Buy Now, Pay Later.

It later began to be used more with the growth of the automobile industry and the introduction of more and more cars.

However, many people don’t understand this process and make mistakes that harm them financially. Let, us know what the 5 mistakes to steer clear of when utilizing the BNPL Payment process but we should know what Buy Now, Pay Later (BNPL) is.

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What is Buy Now, Pay Later (BNPL)?

Buy Now, Pay Later (BNPL) allows people to make expensive purchases and pay for the item purchased later whether next week or next month.

It is very helpful for people because if their desired item is on sale but they don't have sufficient money to buy it, at that time they can make use of BNPL to make the transaction and pay the seller later on.

It is a type of short-term loan with no interest or transaction fees like credit or debit cards and is very convenient. However, there are a few disadvantages of Buy Now, Pay Later payment services.

5 Common Mistakes to Steer Clear of When Utilizing BNPL Payment

1. BNPL Late Payment

You should always be aware of the points put up before selecting the BNPL Payment, whether there are late fine charges, or what consequences that you will face if you miss a payment.

These mistakes people often make while using the BNPL payment service and wind up paying more than what they were expected to pay.

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2. Return or Replacement Policy

Before utilizing the BNPL Payment, you should always check, if the product you purchased comes out to be defective, then what should you do? For example, you bought a television through the Buy Now, Pay Later service and later on found out that it was defective and also the shop isn’t accepting a return or replacement of the TV then forcibly fully you have to pay for the defective item.

So, in these cases what you can do is? Before using the BNPL service, inquire about the return or replacement policy and check your item thoroughly to avoid such problems.

3. Don’t Buy Things That Is Out Of Your Budget

Another mistake that people make while making a purchase is that they get hasty and buy very expensive items and don’t think about how they are gonna pay for it thus leading to paying more.

Thus to avoid such casualties you first need to check that the things you are purchasing are affordable to you or not or whether you will be able to pay it later when your payment arrives.

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4. Don’t Use BNPL Often

There is a valid reason why you shouldn't use BNPL often? If you use the Buy Now, Pay Later option whenever you make a payment then you will miss several benefits that come with using credit cards.

Credit Cards offer discounts, cashback, coupons, and even help to make a good credit score but in BNPL you won’t have any of these features and you won’t get any discount either.

5. Too many loans

Sometimes people often take too many loans and wind up in debt, if you already have many loans then you shouldn’t take them anymore as it will cause huge confusion, or sometimes lack of sufficient money will lead to the loan payment being missing.

So, you should avoid taking too many loans so that later on you don’t have to pay extra.

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