New research by Resolver has found that thousands of people are being penalised or pursued for buy now, pay later (BNPL) debts incorrectly, as a direct result of errors by retailers and credit companies.
Resolver says that it has helped people sort out more than 17,500 complaints about buy now, pay later credit in the last two years. Yet one in ten relate specifically to issues to do with returned items, resulting in people potentially defaulting on credit deals unfairly.
One of the most popular forms of BNPL credit involves ‘try before you buy’ – where consumers try clothes to see if they fit, returning the ones that don’t before a deadline to avoid ‘buying’ them by default. As long as you return the items within a set timeframe – usually 14 to 30 days, depending on the retailer – you should not be billed for the clothes.
Yet Resolver’s users are increasingly reporting that due to returns not being logged properly or lags between the retailer and credit firm communicating, they are still being billed for the returned goods. Many complaints are about the credit firm failing to address the complaint or situation when notified, with some people being passed to debt collectors for relatively small amounts.
The research found:
The Consumer Rights Act and Consumer Contract Regulations provide statutory rights when it comes to returning goods, without the need to take credit out. The laws say:
Resolver’s CEO, Alex Neill, said “Getting a refund for returned goods should be pretty simple – but using buy now, pay later credit to pay for the goods makes it a fiendishly complicated process. Increasing numbers of people are being asked for payment or penalised for late payments for goods they don’t even have anymore.”
“It’s too easy for retailers and credit companies to blame each other when things go wrong – and our users are making it clear that they are struggling to get errors corrected when they contact the firms. Both credit firms and retailers need to act now to stop people paying unfairly for their errors.”