One in eight resorted to buy now, pay later credit as cost of living bites

One in every eight (12%) people in the UK used Buy Now Pay Later (BNPL) last year as the cost of living crisis pushes more Britons to resort to credit, new data has found. The age group that made most use of these services was 35- to 44-year-olds, with one in five Brits in this age group using BNPL services during 2021, according to the latest figures from UK Finance. In contrast, just 4% of people aged 65 or over used these services in 2021. However, the temporary solution risks becoming a permanent problem as inflation continues to squeeze UK households. Almost a third of shoppers who use BNPL credit said repayments on the loans have become “unmanageable”, with the cost of living crisis pushing them into a debt spiral. Consumers are spending more via this form of credit, with shoppers who use BNPL now paying off an average of 4.8 purchases — almost double the average of 2.6 purchases in February, the research found. The average BNPL user’s outstanding balance currently stands at £254, according to research from Barclays Bank (BARC.L) and the debt charity StepChange. Read more: Klarna and your credit report: how buy now pay later will...

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