Signs of Unhealthy PayLater Usage and Wise Tips to Avoid Debt Traps
JAKARTA, KOMPAS.com - The PayLater feature, which offers a “buy now, pay later” concept, is increasingly popular among the public.
Currently, almost everyone has the PayLater feature on e-commerce apps on their phones, and not a few use more than one service at once.
The ease of the process and interest rates considered relatively low make many people use PayLater more frequently for shopping.
The interest deemed light makes PayLater often used not for urgent needs, but to fulfil lifestyle demands.
Waci admits she rarely uses PayLater to buy staple groceries. She more often uses it to buy clothes, viral soaps, and other consumptive needs.
Nevertheless, Waci tries to restrain herself from overusing PayLater.
She always ensures she can pay the bill the following month before deciding to make a transaction.
Another user, Roby (26), admits he started using PayLater in 2020 just to try it out.
Initially, he more frequently utilised PayLater for lifestyle needs. However, over time, he began limiting its use and only employed it for more important and urgent needs.
Even so, restraining oneself from becoming dependent on PayLater is not easy.
Roby considers PayLater advantageous because it allows someone to get the desired item first and pay for it some time later.
Financial planner from Finante.ic, Rista Zwestika, says that although the interest is low, PayLater still has the potential to trap someone in consumer debt.
On the other hand, the trend of PayLater usage in Indonesia has experienced a quite significant increase in recent years.
“This is driven by the growth of e-commerce and the ease of access to digital financial services. Many shopping platforms now directly provide the PayLater feature, so the public feels the process is quick and practical,” said Rista when contacted by Kompas.com on Friday.
However, this trend also reflects a change in the public’s financial behaviour. Many people are starting to get used to buying goods not because they already have the funds, but because instant instalment facilities are available.
Rista explained that based on fintech and e-commerce industry surveys, PayLater users are predominantly from the 18-35 age group, namely Gen Z and millennials.
This group is generally active in online shopping, familiar with technology, and desires convenience and speed in transactions.
“Unfortunately, in some cases, their financial literacy is not always balanced with the ease of access to such credit,” said Rista.
According to her, there are several main factors that make PayLater more popular than other payment methods.
First, the ease and speed of the process, where it can be used in minutes without complicated procedures like applying for a credit card.