Affiliation:
1. Amity University, Noida, India
Abstract
Digital lending has emerged as a disruptive force in the financial industry's ever-changing landscape, transforming the way customers access and manage credit. BNPL products have grown in popularity, particularly among the younger generation, because to their ease of use, flexibility, and seamless integration into online purchasing experiences. Consumers can use these services to break their payments into smaller, interest-free installments, providing an alternative to standard credit products and payment methods. However, the potential costs to consumers have not been quantified. The study results suggest that BNPL consumers face financial charges that are on par with credit card fees and are vulnerable to unfavorable risks due to loopholes in customer protection. Customers face varying expenses both before and after they go into default on BNPL repayments, with the annual percentage rate (APR) ranging from 0% to 36%.
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