Over the last five years, Buy Now Pay Later (BNPL) apps have experienced significant growth, primarily driven by the involvement of companies like PayPal, Apple, and credit card providers. Part of the reason for their popularity is that they are more accessible than credit cards, especially among younger users. Millennials and Gen Z have become the most active BNPL adopters, with nearly 60% of Gen Z in the U.S. having used BNPL at least once.
It is a short-term loan that enables customers to pay for goods in manageable installments over a predetermined period. Typically, these services are used for small but expensive purchases, such as high-end apparel or smartphones. People on a low budget can benefit from BNPL loans because, unlike other loan types, they are typically interest-free and rarely incur additional service fees. Unless payments are missed, which can cause late fees to quickly accumulate. If left unchecked, this negates the initial interest-free benefit and can even impact your credit score negatively.
Convenience like this, though, can have a price, as you may be enticed to purchase more than you can genuinely afford. In the USA, about 41% of BNPL users have made late payments, highlighting the risk of overextension. Continued negligence of regular payments in BNPL systems, aside from impacting your credit score, will lead to restrictions on future usage of the system.
With these options that seem like a better choice, people tend to opt for them without asking themselves if it is the only way they can afford it, and if they are sure they will be able to pay each of the four payments on time. After that, this article will serve as a guide to utilizing all the benefits of the Buy Now Pay Later method.
Understand What You’re Sharing
Using BNPL apps can have real and serious consequences for your privacy. Every time you download and use such an app, you share information about yourself:
- your name
- surname
- home address
- income
- purchase history
- or even your geolocation
Unless you request to remove personal information from Google, your data may be shared with third parties, used for targeted advertising, or, in the worst case, used for fraudulent purposes or identity theft. Spam, fake offers, and even financial scams are just some of the potential risks. Many users are unaware that their data could end up in the hands of unknown companies that may not always have good intentions.
There are also some ways to detect fraud. Most end customers tend to use the same device when making online purchases because passwords and payment information are often saved on a device or web browser that they have previously logged into. There is a higher likelihood that an existing account has been compromised if many devices have attempted to log in.
Choose Reputable Providers
Buy Now, Pay Later (BNPL) services have gained significant popularity in recent years, particularly among younger customers who seek flexible payment plans. Nevertheless, there are some hazards associated with this convenience that are frequently overlooked. Numerous publications have cited instances in which users, having neglected to conduct prior research on the app, ended up with increasing bills or divulged more personal information than they had intended.
You may make a significant difference in protecting your financial and personal information by taking a few extra minutes to investigate how an app handles your data and whether it has received praise or criticism in numerous news reports.
A crucial first step in safeguarding your data is selecting a trustworthy BNPL app. Using apps created by well-known, trustworthy organisations with robust privacy and security policies is advised. When choosing an app, opt for those that are already well-established in the market. You can do that by easily having a look at reviews and ratings. It can save you from many potential future issues.
Your Devices and Accounts
You can always take extra actions when it comes to securing your account, and that entails:
- Creating strong, one-of-a-kind passwords
- Enabling two-factor authentication reduces the likelihood that a hacker will gain access to an account after obtaining the user’s password. It is tough for hackers to guess login passwords when the user’s knowledge and possessions are paired.
- Updating your software frequently.
Emails and messages that might include links to phony websites that attempt to steal your information should likewise be handled with caution. As phishing techniques become increasingly complex, it is essential to remain vigilant at all times.
Limit Data Sharing
Users can attempt to protect their data manually, such as by adjusting privacy settings or removing unnecessary applications. Reduce the amount of information you share with apps. Avoid connecting your BNPL accounts to social networks and other platforms unless necessary. Every additional connection increases the risk of data misuse. When possible, refuse optional data allocation and control what information the app needs to function. Manual removals are helpful, but they are temporary and often challenging to perform.
Unlike these approaches, some services offer a comprehensive and customized solution for protecting personal data. It accomplishes that by routinely submitting queries to data brokers on your behalf, as deleted records frequently resurface. To ensure that your name is never used again, these services will also request that data brokers add your profile to their suppression lists, if available.
Conclusion
Understanding what BNPL is isn’t enough. Before using a BNPL app, it is essential to read its privacy policy. This way, you will learn what information the app collects, including personal data such as your name, address, income, purchase details, and information about your device and location. Also, carefully read what permissions the app requests during installation and registration. Often, the permissions you grant extend beyond the app’s basic needs.
Fraudsters increasingly target BNPL platforms because they often have less stringent credit checks than traditional credit cards. That makes it even more important to stay informed and cautious when using these services.
Buy Now Pay Later is there to help customers and make purchasing items easier. Without protecting your data, the effect could be the opposite. Keeping that in mind, do yourself a favor by following the simple tasks mentioned in the article and preventing future problems.
