Buy now, pay later loans are becoming more popular. Here's what to know

Life Kit

NPR

Health & Fitness, Self-improvement, Kids & Family, Education, Business

4.3 • 3.9K Ratings

🗓️ 20 February 2025

⏱️ 19 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Klarna, Afterpay, Affirm — maybe you've noticed these platforms when shopping online. They allow you to break up large payments into smaller installments that you can pay over time, and are a popular alternative to credit cards. In this episode, we'll cover the pros and cons of these loans and how to use them responsibly.

Learn more about sponsor message choices: podcastchoices.com/adchoices

NPR Privacy Policy

Transcript

Click on a timestamp to play from that location

0:00.0	Public media counts on your support to ensure that the reporting and programs you depend on thrive.
0:06.2	Make a recurring donation today to get special access to more than 20 NPR podcasts, perks like
0:12.8	sponsor-free listening, bonus episodes, early access, and more. So start supporting what you
0:18.7	love today at plus.npr.org.
0:23.9	You're listening to LifeKit from NPR.
0:32.2	Hey everybody, it's Mariel.
0:34.6	Have you seen that pay-in-installments option when you go to pay for something online?
0:38.6	It's called Buy Now Pay Later.
0:40.8	If you're not familiar, Buy Now Pay Later loans are a service offered by financial technology companies like Klarna, after-pay, and a firm.
0:48.4	These loans are an alternative to credit cards, another way to borrow money to buy something.
0:52.8	Though unlike with a credit card, when you use
0:55.1	Buy Now Pay Later, you typically won't pay interest on your purchases. Retailers partner with these
1:00.6	Buy Now Pay Later companies to offer you this service because, well, they think having this option
1:05.6	will encourage you to buy more stuff. And there's evidence that it will. Buy Now Pay Later loans
1:10.7	are popular, by the way. At this
1:12.6	point, one in five shoppers has used them to make a purchase, according to the Consumer Financial
1:17.2	Protection Bureau. Maybe you're one of those shoppers. Do you know what you're signing up for when you
1:22.8	choose this option? Life Kit reporter, Andy Tagle, has been digging into this topic, and on today's
1:28.6	episode, we talk about the upsides and the risks of using Buy Now Pay Later. She'll explain how
1:34.4	these companies make money and what advice experts have if you're going to use these services.
1:41.3	This message comes from Wise, the app for doing things in other currencies.
1:46.0	Sending or spending money abroad, hidden fees may be taking a cut.
	...

Please login to see the full transcript.

Previous episode | Next episode

Disclaimer: The podcast and artwork embedded on this page are from NPR, and are the property of its owner and not affiliated with or endorsed by Tapesearch.

Generated transcripts are the property of NPR and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.