08/04/2026

WEDNESDAY | APR 8, 2026

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Buy now, worry later paradox P ARLIAMENTARY replies reported in local media in early 2026 showed that Malaysia’s buy now, pay later (BNPL) balances stood at RM4.9 billion as of COMMENT by Galvin Lee Kuan Sian

The market test, however, is whether BNPL firms and merchants treat responsible lending as a compliance item or as a product design discipline that reduces fragility while preserving legitimate use cases. I believe these are the three market commitments that would quickly change outcomes. First, BNPL providers should adopt an affordability-by-design approach rather than an affordability-after-default approach. This means treating limits and approvals as dynamic tools that respond early to stress signals, rather than as growth levers that expand with usage volume. Providers should build clearer internal thresholds for when repeat late payments trigger a cooling-off period, when limit increases are paused and when repayment schedules are restructured to reduce clustering. If BNPL is increasingly used for essentials, then product design should prioritise repayment resilience, not only conversion rates, because “manageable on average” is not the same as “manageable for the user segment that drives usage.” Second, marketplaces and large merchants should treat BNPL placement as a consumer trust decision, not a revenue optimisation hack. Checkout design should highlight repayment as a real possibility without shaming the consumer. This means prominently showing the total repayment amount, the number of instalments and the relevant dates while avoiding urgency cues that push users into credit reflexively. It also means ensuring BNPL is not pre selected by default and that the language used does not imply “free money” as fees and penalties can apply under certain conditions. A marketplace that becomes known for painless sign-ups and painful repayment experiences will eventually pay the price in disputes and consumer distrust, even if the short-term numbers look good. Third, the payments layer should establish a shared visibility standard that makes it harder to hide stacking. Banks, e-wallets, payment gateways and credit bureaus should not treat BNPL visibility as a consumer well-being feature, similar to card spend tracking. The most practical step is an industry standard BNPL dashboard that shows a user their upcoming instalments across merchants in one place, paired with a consent-based mechanism for providers to detect high-level stacking risk indicators without exposing sensitive purchase details. This is not about punishing users; it is about restoring the ability to see and manage obligations in aggregate because fragmented obligations are exactly how “small” credit becomes quietly dangerous. BNPL can be a useful bridge when it is designed for resilience and transparency and functions as a controlled budgeting tool rather than a frictionless substitute for income adequacy. Malaysia’s BNPL debate should therefore move beyond the comfort of national percentages and focus on the behavioural reality. A product that sits inside checkout flows will shape spending decisions and a product used for essentials will reflect household stress even when macro indicators look calm. If the market treats BNPL as engineered wage smoothing, then the responsibility is to engineer it for stability or accept that the real cost will show up later as distrust, disputes and financial fatigue among the very consumers the digital economy depends on. GalvinLee Kuan Sian is a researcher in marketing at the Asia-Europe Institute at Universiti Malaya and is a lecturer and programme coordinator at a private college in Malaysia. Comments: letters@thesundaily.com

Dec 31 2025 – about 0.3% of total household debt – with 7.5 million users and an overdue rate of around 3.3%. The reports further indicated that BNPL usage is concentrated among younger and lower-income groups, with modest average transaction sizes, and is primarily used for essentials such as food, groceries, transport and services. These figures are frequently cited to reassure the public that BNPL remains “contained”, a characterisation that is not entirely inaccurate from a macro-level balance sheet perspective. The real question is not whether BNPL threatens the banking system but whether it is becoming a default coping mechanism for cashflow stress. Because this is where long-term consumer harm can build gradually, even when aggregate figures remain small. The metric that hides the real problem BNPL is often framed as a smaller, newer form of credit card debt; however, this comparison overlooks a crucial difference in how the product is actually experienced by users. Credit cards are typically applied for deliberately and then used repeatedly. BNPL, by contrast, is embedded at checkout and presented at the exact moment when attention is focused on the product price rather than the cost of credit. This shifts the cognitive framing from “borrowing” to “splitting”, making the decision feel smaller than it actually is. Such a system can generate hundreds of millions of micro-instalment transactions annually, embedded in everyday consumption, without resulting in a balance sheet figure significant enough to raise alarm. The consumer risk is therefore less about the overall stock of debt and more about rising fragility. This fragility emerges when many small obligations accumulate across merchants and providers while borrowers continue to experience them as a series of separate, manageable commitments. When BNPL is used mainly for discretionary purchases, the product behaves like a convenience. When it is used for essentials, the product begins to behave like salary smoothing, I WAS sitting at a café in Klang when I overheard two Sikh gentlemen speaking about the passing of Karam Singh Wallia. Curious, I asked and soon learned that it was indeed the great Karam Singh Wallia – a broadcast journalist who stood out during his heyday in the 1990s. He was widely known for ending his nightly news segments on TV3 with punchy Malay pantuns that became his signature. Many of us still remember those distinctive poetic sign-offs. He was a legend in Malaysian broadcast journalism, and his passing is a profound loss not only to the Sikh community but to Malaysian society as a whole. Karam left a lasting impact. His unique style and memorable delivery remain etched in the minds of the older generation.

A marketplace that becomes known for painless sign-ups and painful repayment experiences will eventually pay the price in disputes and consumer distrust. – ADIB RAWI YAHYA/THESUN

approval, whereas household budgets are typically aligned with pay cycles rather than recurring instalment schedules. This also explains why overdue ratios can remain modest at the portfolio level, even as a meaningful minority of users experience repayment stress. The risk is concentrated in a segment that is less visible to any single provider’s risk model. Put differently, the early warning signal for BNPL harm is not an economy-wide debt percentage but rising “instalment congestion” among the same households, where recurring obligations collide with rent, utilities and transport costs in the same weeks each month. Malaysia is already moving BNPL providers towards stronger governance expectations under the Consumer Credit Act 2025, including licensing timelines and responsible lending duties, which provide an important foundation.

especially for workers whose expenses do not match the timing of their income and especially when household buffers are thin. In that world, BNPL is no longer simply a payment option because it becomes an informal credit layer compensating for income volatility and rising living costs and the market starts normalising short-term borrowing for routine needs. ‘Stacking’ is where harm concentrates One of the most under-discussed risks in BNPL is “stacking”, whereby consumers maintain multiple accounts across providers and merchants. Individually, these obligations appear small but collectively they can become significant, particularly when repayment dates converge. This reflects a design and data coordination challenge more than a behavioural or moral one, as BNPL is optimised for low-friction

LETTERS letters@thesundaily.com

Tribute to an environmental hero

Like many Malaysians, I followed his reports faithfully and deeply appreciated his dedication to the craft of broadcasting. He retired in 2014 due to health reasons. During his career, he was part of TV3’s “ Aduan Rakyat ” team, which, as the name suggests, highlighted public concerns – especially environmental issues such as river pollution, illegal dumping and deforestation. With clarity, conviction and a firm voice, he brought attention to environmental challenges in a way that resonated with the public. Long before environmental issues became widely discussed, Karam was already raising awareness and holding the spotlight on them. His legacy will live on. K.R. Punithan Secretary Klang Consumer Association

Long before environmental issues became widely discussed, Karam was already raising awareness and holding the spotlight on them. – BERNAMAPIC