A loan applicant with 288 buy-now-pay-later transactions over a 90-day period, a mother charged $760 for a $175 loan and hundreds of vulnerable people signed up to loans they don’t understand nor afford.
All the result of buy-now-pay-later schemes with a primarily younger consumer base identified by ASIC's Review of buy-now-pay later arrangements - including 60% of users being between 18–34 years old.
In addition, 40% of users received incomes of under $40,000 and of this group, almost 40% were either students or in part-time work.
The high growth of the industry was highlighted by the number of consumers using these products increasing from 400,000 to approximately 2 million between 2015 and 2018.
Afterpay, one of the largest buy-now-pay-later companies, reported a 73% increase in full year earnings with $70 million resulting from late payment fees alone.
Following the introduction of responsible lending laws in the wake of the…