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Buy now, pay later: Woman shares story of £5,000 debt after using BNPL | Personal finance | Finance

Chloe, 25, started using paid buy-it-now services when she was just 17 years old. She was still living with her parents at the time and liked to spend the modest earnings from her job on new clothes or shoes for nights out with friends, and remembers being “bombarded” with buy-it-now offers. subsequent payment. Speaking to, she said: ‘I would only spend £20 here, £30 there and the buy now, pay later option was on checkout. It seemed like a really good idea to me because I believed I had the income to pay it back at the time. Chloe then moved out of her parents’ house and took on other financial commitments such as rent, bills and food.

She said: “Things really changed very quickly and suddenly and I found myself with bills of hundreds of pounds at the end of each month. I don’t know how he managed to climb so high.”

Chloe then became pregnant with her daughter when she was 22, and by this point she had managed to rack up around £5,000 in debt on several credit cards and other paying loan companies.

She said: ‘I got a credit card to pay off my purchase now, pay debts later, but that just meant I had racked up more debt with the credit card companies.

“I was so anxious and overwhelmed by it all. People kept chasing me for money I just didn’t have, I stopped picking up the phone and started throwing letters in the trash without reading them.

“It made me so desperate, growing up I was taught that if you can’t afford it, you save up for it or you don’t have it. It just got out of hand so quickly.

During this time, Chloe was too scared to go to her parents for help and began to be frightened by the legal jargon companies used in their correspondence that mentioned County Court Judgments (CCJs) and repossession. of ownership.

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She said: “I just couldn’t understand what was happening to me, I kept thinking people would come to my house and I just buried my head in the sand because I couldn’t cope. to reality.”

Luckily, Chloe came across debt management charity StepChange and, after contacting them, helped her negotiate a payment plan with her creditors.

She explained: “StepChange acted as a middleman for me, I told them what I could afford to pay back and they arranged everything for me, which meant I stopped getting letters and calls and if something changed, I could talk to Stepchange and have it sorted.

“They’ve been a godsend, really helped get me started and since stepping in to help me I’ve managed to pay around £2,000.”

Chloe said her debts had skyrocketed from using the credit card, but she started with buy now, pay later.

She thinks the concept of buy now, pay later is sold in a “light” way, so people don’t see how serious it is and how “too easy” it is to sign up. However, she understands the benefits of this type of payment if people understand how it works.

Chloe said: “If you have to buy groceries for your family and you don’t have the money, you will choose the option to pay later, you don’t think about later because you are desperate now.


“I’m hesitant now, but if my fridge broke down, I could buy a new one and break it down into manageable monthly payments, but that’s because I know how it works and can see the benefits.”

There are several buy-it-now and pay-later companies on the market right now and some services currently offer a “soft credit check” if a person decides to pay in four days, pay in 30 days, or chooses monthly financing, so paying over six to 36 months.

A soft credit check is stored in a credit file, but will not affect a person’s credit score and no other lender will be able to see it.

Chloe feels that additional checks should be made for this payment option, similar to how credit checks are put in place for those who want to take out a loan. For loans, credit cards and mortgages, “rigorous credit checks” are carried out.

This is where the lender will perform a thorough credit check on a person.

A research report by Barclays Bank and StepChange found that due to the cost of living crisis, buy now, pay later loans have become “more attractive” to more than a third of buyers.

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One in four admitted to using buy now pay later for purchases they “couldn’t comfortably afford” and nearly 10% of shoppers plan to use it for the first time this year due to inflationary financial pressures .

The debt management charity said it was “very concerning”.

Phil Andrew, Managing Director of StepChange, said: “Buy now, pay later is deliberately marketed and presented as payment rather than a form of credit, which it really is. It is also marketed not just for lifestyle expenses, but for basic necessities such as groceries or school uniforms.

StepChange believes there is currently “very little friction” to prevent customers from running up “significant debt” with this payment practice and argues that it is “vital” that regulation is in place to protect consumers.

Stricter buy now, pay later regulations are currently being discussed by Her Majesty’s Treasury.

Speaking to, Klarna also believes in stricter regulation for the sector and that it has ‘not waited for BNPL regulation’ and ‘urges the government to act faster’ to protect consumers. against “irresponsible and unregulated buy-it-now”. later providers and traditional banks “disguising high interest products as buy now pay later”.

Alex Marsh, Head of Klarna UK, said: “As a licensed European bank with many years of experience providing regulated credit products in the UK, we welcome the announcement of BNPL regulation by HM Treasury as it will increase standards and consumer protection across the sector.

“As the UK’s largest supplier to buy now, pay later, we will continue to work closely with the UK Treasury and the FCA to accelerate progress and bring future regulation to the highest possible standards at worldwide.”

The group said it made it clear to customers that it offered credit products and had worked with Fairer Finance to ensure its terms and conditions were clear, simple and easy to understand, and had started sharing data buy-it-now and pay-later with credit reference agencies to protect customers from accumulating multiple lines of credit.

Mr Marsh describes Barclays and Stepchange’s research as ‘mind-boggling and frankly irresponsible’ as they endorse ‘high interest’ credit products such as credit cards.

He added: “The findings of this Barclays report are extremely condescending to UK retailers who already choose their credit providers based on their responsible lending practices and quality of service.

“With consumers rating Klarna Excellent on Trustpilot four point five out of five stars from over 150,000 reviews, compared to Barclays only getting one point five out of five stars, it’s no surprise that UK retailers , like their customers, are abandoning the old banks.”

Chloe isn’t out of the woods yet, as she’s still working to pay off her last debts.

She said: “I’m in control again and if circumstances don’t change, it looks like I’ll be able to repay these debts in full within the next two years. I can’t even imagine the relief I’m going to feel when that day comes. will eventually come.