Interactive Investor

Buy-now-pay-later lending is fastest-growing form of credit in UK

2nd February 2021 12:20

Myron Jobson from interactive investor

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interactive investor comments on FCA regulation of buy-now-pay-later lending.

Commenting, Myron Jobson, Personal Finance Campaigner, interactive investor, says: “Buy-now pay-later lending is like a drug that encourages impulse shopping, often targeted at young people, via Instagram and other social media channels, who want to look the part or have the latest gadget without actually having the money to pay for the goods themselves. The very existence of this form of lending flies in the face of the age-old, yet still important and relevant, financial lesson of spending within your means.

“It is clear that regulation of buy-now-pay-later lending is needed to keep tabs on what is the fastest-growing form of credit in the UK – which nearly quadrupled in 2020 and is now at £2.7 billion according to the City watchdog.

“Buy-now pay-later lending seemingly filled the void left by many payday firms that went the way of the dodo following a FCA clampdown. The explosion of this form of lending in recent history underlines the importance of financial education from a young age. While debt is not inherently bad, knowledge on how to keep a handle on it to keep it spiralling out of control is vital.”

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