Why you should be wary of buy now pay later

Are you logged on to Klarna, Clearpay, Laybuy or Zilch for your Black Friday shopping binge — or are you an old-timer like me who still uses traditional credit cards and even sometimes tries to pay for purchases in cash? If those four brand names meant nothing to you, you are yet to join the millions of UK shoppers who have discovered ‘buy now pay later’ (BNPL) apps that offer, with a couple of simple checkout clicks, payment for fashion and beauty purchases, and even groceries, in a series of interest-free instalments.

‘Shopping just levelled up’ is Klarna’s witty slogan for its three-instalment offer; at Laybuy, it’s six; at Zilch, 25 per cent up-front and the rest later. Own whatever you love and deserve — from Boohoo, Asos, Pretty Little Thing or Lush, to name a few — but don’t pay for it yet. And so what, you might be thinking: aren’t credit cards just the same but more expensive, a fountain of instant credit that tempts us to spend more than we can afford, then hits us with stinging interest rates if the balance isn’t promptly paid off? We’ve all been using those for half a century.