Buy Now, Pay Later is expanding fast, and that should worry everyone

The rapid expansion of Buy Now, Pay Later (BNPL) services, with 91.5 million users in the U.S., raises concerns as people use these services for basic needs like groceries. Default rates are rising, and most BNPL loans are not reported to credit bureaus, creating 'phantom debt'. Despite regulatory efforts, the lack of visibility into BNPL debt, combined with rising unemployment and the end of student loan forbearance, could lead to a financial crisis. The BNPL model, which prioritizes smaller loans, may hide larger debt issues, and the integration of BNPL into traditional finance and B2B lending could exacerbate the problem.