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Butter introduces BNPL card

UK-based buy now, pay later provider Butter is bidding to put a nail in the coffin of the credit card with the launch of its own BNPL card.

  6 4 comments

Butter introduces BNPL card

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

While 65% of Brits have credit cards, the number being issued has fallen by three per cent over the last year, while the value of consumer purchased goods on credit has tumbled. Meanwhile, the BNPL sector - while still far smaller than credit cards - has seen huge growth.

However, BNPL is still mostly limited to online purchases, something that Butter is hoping to change through the introduction of a physical card.

Timothy Davis, CEO, Butter, says: "We wanted to create a physical product that transcended the current BNPL boundary between online and physical transactions, providing an additional option for consumers that allows them to buy on credit, without having to use a credit card."

The card can be used to spread the cost of purchases anywhere, online or in-store. Customers can choose to split payments across as many 10 instalments and manage their card through the Butter app.


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Comments: (4)

Giles Sergant

Giles Sergant Director at Consultant

Subprime 2.0, The Sequel

Melvin Haskins

Melvin Haskins Managing Director at Haston International Limited

I could not agree more.

A Finextra member 

Apparently BNPL is  liked by minorities,  especially those  prone to impulse buying and used a lot by them as a result.  

A Finextra member 

The problem is the companies are putting these people in debt.  Australia’s financial regulator found 15% of BNPL users had to take out another loan to make their payments, and 1 in 5 had to cut down spending on essentials to make them. In 2019, Australian BNPL providers raked in $43 million in revenue from late fees, up 38% from the previous year. At a major U.K. bank, 10% of customers making BNPL payments overdrew their checking accounts in the same month. The authors of one study dubbed BNPL users “Generation Debt Trap.”

Some young people are beginning to catch on. TikTokers are dancing to the caption “crippling debt” after showing themselves purchasing new clothes with Klarna.

 

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