comparethemarket.com study indicates BNPL scheme danger

Over two million UK adults to have used ‘Buy Now, Pay Later’ schemes (BNPL) have had their credit scores damaged as a result, according to a new survey commissioned by comparethemarket.com.

The comparethemarket.com survey, conducted on its behalf by Populus who surveyed 2,096 adults in December 2019, indicated that 41% of respondents were unaware that BNPL schemes could affect their credit score.

BNPL schemes, which allow shoppers to delay or spread the cost of a purchase, have become a commonly used payment method. The survey suggested one in five adults had purchased items through one of these schemes in the past twelve months – equating to 10 million people across the UK.

comparethemarket.com also highlighted that consumer debt had increased by £60bn in the last five years.

Furthermore, the survey found the majority of respondents felt BNPL schemes had contributed to their increased levels of personal debt, with 39% of those aged between 25 and 34 years also suggesting such schemes had damaged their credit score.

comparethemarket.com head of money, John Crossley, commented: “The allure of BNPL is clear, but these statistics show that such schemes are encouraging people into taking on more debt than perhaps they realise.

“Failure to pay outstanding bills can damage your credit score and result in a spiral of outstanding payments which could jeopardise important life milestones, like buying a house. It is concerning that many of these schemes appear to be targeted at younger demographics.”

    Share Story:

Recent Stories


Mortgage Insider Series 2 Episode 4: Understanding the first-time buyer
Listen to our latest episode where we discuss first time buyer experiences and changing mind-sets. We hear from recent first time buyers about the struggles they’ve experienced, and chat to Habito founder Daniel Hegarty and That Property Guy Kyle Mattison about how they bridge the communication gap. Make money work for you.

FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.