PETALING JAYA: Young consumers signing up for “buy now pay later” (BNPL) schemes face the risk of increasing debt as the ease of access and lack of up...
Mohamad Idham said BNPL schemes create the appearance of affordability and encourage consumers to seek instant gratification at the expense of sound financial planning. – ADAM AMIR HAMZAH/THESUNYoung consumers signing up for “buy now pay later” schemes face the risk of increasing debt as the ease of access and lack of upfront costs make such schemes appealing, said UiTM Academy of SME and Entrepreneurship Development coordinator Dr Mohamad Idham Md Razak.
Mohamad Idham said young adults seem to be making impulsive purchases without understanding the long-term financial consequences.could spur long-term behavioural changes that encourage reckless spending and normalise the population’s debt load. This would lead to financial vulnerability.” He said financial ignorance is a major driver of debt mismanagement and impairs one’s ability to decide on borrowing and spending as individuals might underestimate the true cost of their debt, leading them to borrow more than they can manage, overspend and accumulate high-interest charges.
Mohamad Idham said the rising debt burden of those aged 30 and below could be countered with a strategy that integrates financial education, oversight and tailored support, and includes financial literacy programmes in school curriculum as early as possible. Muslim Consumer Association president Datuk Nadzim Johan said many people seek the pleasure of having money despite their unstable finances.
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