25/01/2026

ON SUNDAY January 25, 2026 theSunday Special VII

E VER clicked that “Buy Now Pay Later” (BNPL) option at check out and felt like you just got a free pass to buy now and worry later? That little checkout but ton has become super tempting, especially for Gen Z in Malaysia, juggling rent, food delivery, car ride-hailing and side-hustle ZRHV %13/ R̆ HUV LQVWDQW JUDWL¿FDWLRQ Tap now, pay in instalments. But is it really free and is paying later always better? Let’s talk numbers. In just the first half of 2025, Malaysians made over 102 million BNPL transactions, totalling a whopping RM9.3 billion. That’s a 31% jump from 2024. Young adults (ages 30 and under) accounted for 40% of those purchases. As fun as that may sound, by June, outstanding BNPL debt had climbed to RM3.8 billion and RM121.8 million of that was overdue. In credit-speak, that’s 0.2% of total household debt tied up in BNPL. Seems small, right? But even small cracks cause trouble later, especially when interest, late fees or multiple plans stack up. Here’s where it gets tricky. BNPL ser vices often brag “no interest” but gloss over WKH ¿QH SULQW “Many believe there is no interest at the start, but hidden charges, fees and terms are often overlooked,” said Universiti Teknologi Malaysia’s Dr Nanthakumar Loganathan, associate professor at the management faculty. And when you miss a payment? Late fees kick in, debt collectors get called and you might get blacklisted. This will hit your ability to borrow again.

BNPL trap among Gen Z

BY ASHRAF WAHAB

Some platforms market BNPL by stressing convenience while downplaying the risks.”

The shiny lure of “pay later”

Fomca backs the government’s move WR HQIRUFH D̆ RUGDELOLW\ FKHFNV XQGHU WKH upcoming Consumer Credit Act 2025, but stresses that strict enforcement is a must. E-commerce players should face the exact disclosure requirements as conventional lenders, be capped on late fees and have the option to pause repayments during disputes. Globally, there’s growing evidence of buyer’s remorse. A 2024 survey found 56% of BNPL users either overspent, missed a payment or regretted their purchase. On the systemic side, BNPL use has been linked to higher overall spending versus using a credit card, arguably because the easy instalment setup masks the actual cost. Though those figures aren’t specific WR 0DOD\VLD WKH\ DOLJQ ZLWK ORFDO WUHQGV Social media hype, an impulse-buying FXOWXUH DQG ORZ ¿QDQFLDO OLWHUDF\ What can Gen Z do to avoid regret? Let’s dial back the worry a bit. BNPL isn’t inherently evil; it’s a tool. But like any tool, it’s all about how you use it. Here DUH VRPH WLSV • Read the fine print: Know fees, repayment terms and penalties. Don’t assume “no interest” means no cost. • Treat BNPL like actual credit: Set budget limits, track due dates and avoid stacking multiple plans.

• One study on young Malaysian adults found that perceived usefulness and VRFLDO LQÀXHQFH VWURQJO\ GULYH %13/ use. This basically means that if your IULHQGV XVH LW DQG VKRZ LW R̆ \RX¶UH more likely to join the trend. • Another regional survey suggests hedonic (fun or pleasure-motivated) reasons are a major driver of impulsive EX\LQJ YLD %13/ ZKLOH EHWWHU ¿QDQFLDO literacy actually reduces impulsive purchases. Put those together and Gen Z’s tech-savvy habit of scrolling through social media, feeling FOMO (fear of missing out) and FKDVLQJ LQVWDQW JUDWL¿FDWLRQ PDNHV %13/ dangerously appealing. Loganathan pointed out that BNPL could become a debt trap, especially for WKRVH ZLWK OLPLWHG ¿QDQFLDO OLWHUDF\ DQG WKRVH LQÀXHQFHG E\ VRFLDO PHGLD GULYHQ impulse buying. From the consumer protection side, Fomca’s CEO, Dr Saravanan Thambirajah, shared serious concerns. “Some platforms market BNPL by stressing convenience while downplaying the risks. Phrases such as “zero interest” or “pay later” are highlighted, but the consequences of non-payment are far less visible,” he said. He pointed out that BNPL can give D IDOVH VHQVH RI D̆ RUGDELOLW\ OHDGLQJ WR overspending when multiple BNPL plans are used simultaneously.

Thambirajah

• Pause and ask before you pur chase: Do I truly need this now? Can , SD\ LW R̆ TXLFNO\" • Boost your money smarts: FOMCA DQG UHJXODWRUV XUJH ¿QDQFLDO OLWHUDF\ from an early age, such as taking online courses or using budgeting apps. • Speak up if something’s wrong: If an item is faulty or has not yet arrived and payments continue, escalate it via your BNPL provider or register a complaint. BNPL is red-hot right now for a reason. It’s fast, easy and taps directly into Gen Z’s desire for instant solutions. But that convenience carries a price, especially if EXGJHWV DUH DOUHDG\ VWUHWFKHG RU ¿QDQFLDO tools aren’t fully understood. “BNPL is still a form of credit, not free money. Consumers should only use it if they are certain they can repay on time. Keep track of all commitments and avoid overspending. The key is moderation and awareness,” Loganathan reminded. So yes, you can buy now and regret later, unless you spend smart, stay informed and never forget that ‘later’ eventually becomes ‘today’ again.

BNPL is still a form of credit, not free money.”

Loganathan

Gen Z’s spending habits and psychology What makes Gen Z in Malaysia especially vulnerable to BNPL entrapment? A few VWXGLHV VKHG OLJKW • A TXDOLWDWLYH VWXG\ ZLWK ¿YH 0DOD\VLDQ users aged 23–37 (covering Gen Z and millennials) found BNPL changes how people perceive debt, spending and ¿QDQFLDO GLVFLSOLQH FDXVLQJ DQ[LHW\ guilt and strain. • About 45% of Malaysians have used BNPL. This no longer makes the service a niche. • BNPL spending is expected to grow at a compound annual growth rate of 26.1% from 2023 to 2030.