One in twelve now using BNPL to cover basic costs

One in twelve people turned to Buy Now Pay Later (BNPL) to cover basic costs such as food and toiletries in the last six months research by Citizens Advice has found.

The charity discovered young people, those in debt and those claiming Universal Credit, are at least twice as likely to have used BNPL for essentials than the general population.

Citizens Advice says that Buy Now Pay Later is often advertised at checkouts as an easy way of splitting or delaying payments on items such as clothing or electronics. But it remains unregulated, and the charity is particularly worried about the rise of firms offering BNPL for food shopping in the past few years.

The charity’s frontline advisers have been raising red flags on the problems they’re seeing, including a parent using BNPL to buy baby clothes while waiting for a benefit payment and someone in debt using BNPL for the weekly food shop.

Gillian Percival, Benefits Caseworker at Citizens Advice Copeland in Cumbria, said “Buy Now Pay Later is a double-edged sword. It can be useful if you understand what you’re getting into, but if you’re using it out of desperation you probably have no way to repay.”

“We try to help people with foodbank and fuel vouchers, but some people are embarrassed to ask for help if they’re struggling. If they use Buy Now Pay Later they’re invisible. They don’t need to speak to anybody, with a few clicks they can borrow instead.”

“They can resolve their problems immediately without having to worry about the consequences.”

Citizens Advice has been calling for urgent regulation of the sector, including for consistent, market-wide affordability checks and for BNPL firms to make the consequences clearer for consumers if things go wrong.

Dame Clare Moriarty, Chief Executive of Citizens Advice, said “The fact that people are turning to Buy Now Pay Later for their groceries really hammers home the urgent need for industry regulation.As living costs spiral, we fear more people in desperate situations will see this unregulated form of credit as the answer.”

“The Government must keep pace with these firms and ensure consumers are protected.”