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How Pay Now Buy Later is gaining ground in the world drowning in debt


There has never been a more critical time to strengthen financial resilience, as the cost of living crisis is seeing high energy bills, rising inflation, and a general sense of tension gripping household finances. For consumers on a financial precipice, this cost of living crunch is close to pushing them over the edge, with a third of shoppers who use buy now, pay later (BNPL) credit reporting their loans have become “unmanageable”. 

The increasingly controversial form of credit has seen the average user rack up an outstanding balance of £254 amongst an increasingly challenging financial landscape of high energy bills and rising inflation. According to charity Citizens Advice, over two in five BNPL shoppers have used credit cards or other forms of borrowing to make repayments, forcing them into a debt trap which becomes harder to climb out of as time goes on. 

The Citizens Advice charity also found that one in 10 BNPL shoppers had been chased by debt collectors in the last year. Not only that but BNPL shoppers were stung with £39 million in late fees in the year before the report’s release. Developments like these have prompted calls for further regulation of the sector, especially after BNPL saw explosive growth in recent years, with total consumer payments via BNPL services in 2021 growing to five times that of pre-pandemic levels. 

Advocates have said that BNPL throws open the financial doors for those who have previously been excluded from traditional credit options and that there is an inclusive element to the services. However, there is also the growing sentiment that BNPL services are overly accessible, heavily promoted to those who do not fully understand them and present a slippery slope for which people (especially younger generations) begin sliding into debt. 

After all, BNPL services have not been limited to discretionary items but have now, thanks to some London-based providers like Zilch, been extended to buying essentials like groceries. Some providers allow consumers to use BNPL to cover their electricity bills. This has become especially risky as people struggle to make ends meet. It only takes a couple of clicks to form a credit agreement that many consumers may not thoroughly read or comprehend. 

Retailers have been keen to hop on the BNPL bandwagon as it provides what many see as a magic bullet, with projections showing that conversion rates can increase by a staggering 20 to 30 per cent when a BNPL option is offered. However, even though consumers believe that the services advertised are interest-free, in reality, the small print often states that this only holds when buyers keep up with repayments. 

What is Pay Now Buy Later (PNBL)?

One of the most considerable consumer risks is the possibility of overspending, which can cause negative financial habits that affect their credit score and ability to secure loans or credit further on in the future. This is where Pay Now Buy Later (PNBL) comes into play, which helps to celebrate healthy spending habits and paves the way for a much more positive financial future.

PNBL is much like it sounds – people only spend what they can actually afford. In other words, it allows people to use upfront prepaid payments to increase their control over their budgets. To better manage their finances, people are using top-up gift cards and mobile top-ups through platforms like to track and better control spending. 

These methods are booming as budgeting and financial literacy gain more popularity. Prepaid cards give consumers more financial visibility, showing how much they earn and spend each month, and allow for greater household money management. 

It is also a simple and secure way for parents to teach their children and teenagers about positive money management – allowing households to purchase pre-paid cards for entertainment services, including Spotify, Apple and Google Play, as well as gaming gift cards for multiple services, including Roblox, the PlayStation store, Xbox, Nintendo.

As money becomes increasingly digitalised, children and teenagers are not using the same physical methods of cash that their parents might have used. There are no more piggy banks, and funds are becoming less visible. Instead, prepaid top-up cards can help younger consumers better understand the value of the services they are consuming and how much it costs to enjoy them. 

Beyond the younger generations, adults will also find that PNBL can be especially effective when applied to fixed costs like subscriptions. Each household now has an average of seven contracts and spends £552 a year on subscription services, plenty of which are often forgotten after the first few months. 

Overall, PNBL enables an approach to personal finance where consumers only spend what they have. This provides a much more robust financial foundation for households, parents, and the younger generations, which is especially important as economic times become increasingly challenging.

Günther Vogelpoel is the CEO of, which is the European leader in online consumer-branded payments. Operating in over 150 markets around the world the company processes millions of online transactions annually connecting customers with leading global brands. Through a broad selection of digital vouchers & prepaid money from brands including CASHU, paysafecard, Apple, Google and PlayStation alongside cross-border remittances of call, data credits and more,’s digital platform improves customer outcomes and disrupts traditional players across the globe. Founded in 2010 and headquartered in Amsterdam, is one of Europe’s fastest-growing technology companies.

This article is part of a paid partnership with social impact media firm Ecology Media, which is running a special editorial series called A Better View to explore the ethical and diversity challenges that exist in the world of innovation – and the ways they can be fixed.

For partnering opportunities, contact [email protected].

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