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“Buy Now, Pay Later” is taking off in travel… and crashing Gen Z

Buy now pay later travel // Illustration by Kate Walker

“Buy Now, Pay Later” is taking off in travel… and crashing Gen Z


Future. “Buy Now, Pay Later” (BNPL) platforms have made it more affordable for people to travel, and booking sites are more than happy to accommodate. But as the pay-in-four model takes hold across multiple industries (putting some people in debt), the art of keeping track of every payment may become an undue burden.

Vacation in Four
According to Fast Company, BNPL platforms are giving people the travel bug.

  • Third-party booking sites like Priceline and Expedia are getting in on the pay-in-four action, while Airbnb now lets customers use PayPal Credit for reservations.
  • Atmosphere Research found that 4 in 10 recent travelers took their trip because they were able to use a BNPL platform to pay for it.
  • No wonder Klarna bought trip-curation platform Inspirock back in October.

While Brett Snyder of Cranky Flier says that BNPL gives people on a budget a better chance at traveling, consumer expert Clark Howard warns that it gives them “the perception that you can afford it. It’s the perfect example of consumer psychology. People want the green light to spend money, when they know they shouldn’t.”

Debt drip
With inflation taking hold, Qualtrics and Credit Karma found that not only are over 60% of Americans using BNPL platforms, they’re also using it more. The problem with that? 20% said they also missed a payment… and a third of those say it led to declines in their credit scores. It’s even worse for Gen Z. Piplsay found that 43% have missed a payment.

While BNPL has become a major driver of economic activity in the past couple of years, it’s no wonder that the Consumer Financial Protection Bureau is looking into BNPL platforms, especially since they allegedly promote overspending and bypass normal credit and loan regulations.

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