Martin Lewis slams unregulated buy now pay later space

Martin Lewis is not a fan of the booming buy now, pay later space.

The English journalist/TV presenter and founder of MoneySavingExpert.com expressed his concerns on Twitter last night.

I'm very concerned about the growth of Buy Now Pay Later. It's exploding like payday loans did. And like payday loans were, it's a huge credit industry that's unregulated - so few rules, and you can't go to ombudsman.

That must change. Amend the fin services /regulation bill
— Martin Lewis (@MartinSLewis) December 2, 2020

“Some people don't even know they're signing up for it. Yet there are also huge numbers with mental health issues and capacity issues,” he added.

“These schemes encourage people to increase spending - even if not right for them. The key is to regulate it - get rules in and a proper complaint system.”

Whilst many agreed with Lewis, some defended buy now, pay later players like Klarna and Openpay.

“It’s not fair to the majority of people who would use this method wisely, we can’t always make decisions to appease the lowest common denominator,” argued @Teessidetommy.

And @JamesNimmo0864 stated: “I’ve always used Argos’ BNPL to my advantage and use them for big purchases and pay it before the due date.”

“Often people think they’re 0% IFC agreements. People just need to read the small print and know what they’re signing up to.”

Risky business

Money.co.uk also recently launched an attack on buy now, pay later ventures.

Salman Haqqi, a personal finance expert at money.co.uk, said: “While these schemes, like Zilch, Klarna and Clearpay, are quick and easy to join and seemingly harmless, they are in fact an entry point to debt for many.”

“Their quick and easy sign-up process, minimal credit check, and youthful marketing appeal could be causing shoppers to sign up and spend more than they can afford without understanding the full risk.”