Have you used Buy Now, Pay Later providers like Klarna, Clearpay and Laybuy?

Former_MSE_Will

Hi everyone, 

What are your experiences of using Buy Now, Pay Later firms like Klarna, Clearpay and Laybuy? These types of firms often allow shoppers to buy products online or in shops and pay in installments over a short period, without adding on any interest.

I'm looking into this area and I'm really interested to know how the experience is overall (good/bad points), and if the availability of this payment method has changed your behaviour or spending decisions. 

If you've used Buy Now, Pay Later, how's it gone for you? Or if you avoid it, why is that?

MSE Will

Mrs_Ryan

I use Klarna and Clearpay. Never had an issue with either of them. My balance on Klarna is very high at the minute (but I’ve just made a load of payments so that will alter) I found Klarna very hard to get, they refused me so many times before they said yes but my spending limit seemed to raise a lot quicker than it did with Clearpay. I got Clearpay first and my limit was only about £100 to start with but it’s rocketed to £1k now.
I tend to now actively seek out sites that take either Klarna or Clearpay and would rather use them than pay in full (I also use BNPL on Very) 
I’m actually quite grateful to Klarna, as they allowed me to spread the cost of some very expensive concert tickets. While I had the money to pay in full, it was certainly helpful to be able to spread the cost. 

Managed properly, these are a good tool. I’ve bought most of my Christmas presents through either Klarna or Clearpay. I have to admit though I’ve bought quite a lot of things I definitely didn’t need, the £75 bottle of Jo Malone perfume through Clearpay and £145 on a pair of pink sequinned Uggs through Klarna are just two prime examples! 

However I’ve seen what happens when they go wrong- my brother ran up a huge bill on Clearpay he couldn’t pay and it’s very very easy to lose track and control. 

They’re definitely a good idea but I think the controls need to be tighter- Klarna for instance don’t credit check yet have allowed me to run up £1200 in a month. (Probably because I’m such a good payer, the latest I ever pay is the automatic payment taken from the card- and I’ve never had a single automatic payment on Clearpay, I always pay early) 

jefaz07

I use Laybuy on occasion. Stuff from MyProtein and most recently trainers from JD. 
I try not to use too much and always have the money to pay it off in full ready. 

I also use Tymit Credit Card...this gives you up to 3 months interest free too. 

Vinknut

I use BNPL on Very, and have been really happy with it.
You just need to be careful to pay it off before the BNPL period ends (obviously), and also wait for Very to have a sale or some  10-20% off vouchers, or cashback, otherwise the base price for some things can be a little high.  They also let you make payments as/when towards your choice of BNPL balance, so you can easily spread the payments out over 12 months, or pay it all off in one go at the end.

TheAble

My inclination would be that these services tend to encourage overspending. They might be useful very occasionally, used extremely sparingly. On the whole though folks would be better off saving up for stuff first - less tempting to spend when you have to fork out hard cash.

A_Random_Man

I have used Klarna every so often and never had an issue I only use the slice it into 3 payments never taken out any off credit with them. I can see how some may be tempted to overspend with these however I only limit myself to a few purchases but pretty happy with Klarna so far 

jimmynoton

I discovered Klarna back in October. It is brilliant. I purchased £474 worth of Rugby League World Cup tickets. The payment was split into 3 and the installments were taken automatically and on time. It was a very straightforward process and I certainly wouldn't have been able to pay the money upfront. So thanks Klarna! COME ON ENGLAND 🏴󠁧󠁢󠁥󠁮󠁧󠁿 

[Deleted User]

Used Klarna for 3 interest-free instalment payments on Ebuyer but I could have just paid it in one go if I wanted to. I did notice however that they did a soft credit check search.

Alarae

I tend to use Klarna on high volume orders when I know I will probably send items back (hello ASOS). It means I'm not waiting for a refund on my own money, which is sitting in an account gaining (paltry) interest.

I can see how it can encourage some people to spend who have the intention to pay back but then find that because the money hasn't left their account, it's used on other things. Then the BNPL payment comes and it's already been spent. 

For others, it's a useful tool to spread bigger purchases. 

Aspiration

I’ve used Klarna for car tyres etc as it’s really beneficial to spread the payment. 

Definitely can see how it would easily creep up though if you weren’t careful as it’s almost so easy it doesn’t feel like ‘Real’ debt.

BabyStepper

If you don't have the cash to buy something then you can't afford it. If you're seeking out short term credit, why not do short term saving and buy the thing with cash? The good/bad points of any credit are very straightforward. Credit encourages you to overspend and shows that you don't know how to budget. It can help you out of you're in a desperate emergency but you still need to budget to pay it off. Most of the debt free diaries on here, including mine, are from people who didn't understand this and kept taking on debt. 

Don't do it. Just save the money and pay cash.