‘Buy now, pay later’ schemes need regulation

BUY now, pay later (BNPL) schemes are growing rapidly in Malaysia. Under this scheme, when a product or service is purchased, the purchaser makes a down payment and settles the rest of the payment through instalments over a certain period, usually more than three months. And usually, there are no interest charges.

The benefit to consumers is that it allows consumers to break their purchases into manageable payments and benefit from the 0% interest rate. Often, consumers do not need a good credit score to qualify for the scheme, thus there is often a lower entry barrier to BNPL schemes than credit cards or bank loans.