
This study assessed how consumers perceived financial risks when using two popular buy-now, pay-later services, Affirm and Afterpay, that are offered at the point of sale by online vendors. Above, a few of Affirm’s merchant partners at the time of the study in 2022.
- This study investigates consumer understanding of financial risks associated with BNPL services, focusing on Affirm and Afterpay in 2022.
- BNPL services disproportionately target financially vulnerable consumers, potentially exacerbating debt cycles.
- In an experiment, most users struggled to comprehend key loan terms, such as payment frequency, number of installments, and the potential impact on credit scores.
- Authors recommend further research to assess the impact of the May 2024 expansion of Truth in Lending regulations on consumer financial outcomes.