VIDEO: ‘Tis the Season … to Buy Now, Pay Later
‘Tis the time of year for pumpkin pie, eggnog and loading up on holiday presents!
Believe it or not, Thanksgiving is less than two weeks away, Chanukah starts three days after the turkey feast and Christmas Eve will arrive in the blink of an eye.
Research analyst Kelly Green, contributor to Weiss Ratings Daily, predicts that holiday spending will be at its highest in a long time for two main reasons:
1. Families will want to make up for time lost during the pandemic and gatherings will be a gift extravaganza.
2. An increasingly popular version of the “buy now, pay later” option makes online shopping even more convenient.
Kelly says the payment method is “the biggest trend this holiday season,” adding:
People didn’t get to see their families last year.
So, now it’s going be this overcompensating, “let’s do a little bigger” Christmas and we can finance it eight weeks out.
I think this new form of “buy now, pay later” is really going change the amount of money spent this holiday season.
Instead of racking up credit card debt, payment processors — the middlemen between the consumer and merchant — allow customers to pay interest-free installments over a selected period of time.
Each payment processor has its own requirements for customers to sign up … like having a credit card or debit card, paying a certain percentage for the merchandise up front or making a purchase that costs more than $35.
As long as you make the payments, there are no fees.
This “new and improved” payment option is being promoted as a way for people to budget.
And the trend is pushing the buy now, pay later — BNPL — market to a whole new level.
• By 2028, the global BNPL market could be worth more than $20 billion with a compound annual growth rate of nearly 22%.
One study puts the market at more than $3 trillion by 2030!
In this special four-minute video segment, Kelly describes how this trend can be a crucial tool for consumers this season and beyond. She believes it’s already transforming e-commerce and presenting massive investment opportunities along the way.
Kelly — who found herself in mounting credit card debt years ago — wonders if credit card companies will be given a run for their money:
How “buy now, pay later” works is the payment processors are in charge of this financing. So, the store gets their money “now,” you get your item “now” and the processor is actually taking on that buy now, pay later risk.
It’s a win-win for consumers, and they’re going to use it. It’s going to be very integral to how people spend money online. I think it’s a trend that’s going to keep exploding.
Instead of putting [purchases] on a high-interest credit card, consumers are going to choose to create payments, and they’ll want to stick to their payments.
In this insightful video, Kelly discusses:
• Three big companies riding the BNPL wave.
• Why this not-so-new trend has gained traction in recent months.
• A breakdown of how each generation of consumers contributes to the BNPL market.
The information in this short segment couldn’t be timelier. I suggest you watch it now.
Financial News Anchor
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