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BNPL's Darkside

Part of

The Gen Z Debt Spiral

MA 22/23
Financial Wellbeing, Financial Services, BuyNowPayLater

‘Buy Now Pay Later’ is an innovative financial product that has disrupted the traditional credit and lending industry by allowing consumers to spread the cost of their purchases into multiple instalments with no interest.

Through this project, we focused on GenZ’s relationship with spending money through an emotional lens to understand how strategies like BNPL or virtual credit can better support them in meeting their present and future needs.


Valmina Prezani, Product Director Retail Banking, Temenos UK

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BNPL: Debt trap or Essential aid?

The pandemic saw a huge uptake in use of BNPL. Today the use is much more complicated and people are using it for more frequent purchases reflecting an increasing reliance on credit to extend their spending power. It currently is a 'one size fits all' solution - from affording luxury to managing expenses with the cost of living crisis.

On one hand, BNPL is becoming an essential choice that consumers are preferring because it gives them a lot of flexibility whether they’re funding takeaways, essentials or experiences.

On the other hand, BNPL gives everyone easy access to credit without any prior checks and takes away the emphasis from the actual cost and terms of use, fuelling impulsive purchases. GenZ happens to be the group most reliant on BNPL services and this may quickly turn into a debt trap for most vulnerable users.


With a focus on the next 10 years, how might we use BNPL and credit as a positive enabling force that supports the long term financial well-being of GenZ and advocates for its more ethical and responsible use?


We probed into GenZ’s point of view towards Buy Now Pay Later, their understanding of credit and how they make decisions when spending money through a series of interactive experiments. 

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