The “Buy Now, Pay Later” (BNPL) trend is reshaping how consumers approach credit and make purchases. In this enlightening episode of the Make Money podcast, we explore the full spectrum of consumer credit by focusing on the rise and impact of BNPL schemes. Claudine Gakundi, Country Manager at Lipa Later, joins the conversation to break down what this financing model means for everyday Kenyans.
Understanding Buy Now – Pay Later
BNPL is a payment solution that allows consumers to acquire goods—such as electronics, furniture, and other big-ticket items—immediately while spreading the cost over a set period. This option is especially popular among younger consumers who may lack access to traditional credit. With BNPL, no upfront payment is required, and in many cases, it comes with little to no interest, making it an attractive alternative to credit cards or bank loans.
The Pros and Perils of Consumer Credit
While the convenience of BNPL is undeniable, it’s important to weigh the potential pitfalls. On the positive side, it offers instant gratification and can help build a credit history if managed properly. However, the ease of deferred payments can lead to impulsive spending and growing debt, especially for consumers who take on more than they can repay. Claudine highlights the importance of financial discipline and awareness when using such credit tools.
Who Should Consider BNPL?
BNPL isn’t for everyone. It’s best suited for those who have steady incomes and the ability to budget responsibly. If used wisely, it can support responsible spending and enable people to acquire necessary items without financial strain. However, it should not be seen as free money or a license to overspend. The key is to treat it as a structured financial product with real obligations.
Smart Money Tips from the Experts
This episode of Make Money doesn’t just stop at explaining the BNPL model—it offers actionable advice. Claudine and host Kepha Muiruri share tips on how to manage consumer credit, stay financially disciplined, and make smarter purchase decisions. Whether you’re new to credit or exploring new financing options, this episode will help you navigate the evolving world of consumer finance in Kenya.
Tune in and listen:
Season 2
Episode 1: Redefining your money goals
Episode 2: Making money work for you
Episode 3: Where to make money in 2024
Episode 4: Make your side hustles worthwhile
Episode 5: Loan and Behold: The art and science of borrowing
Episode 6: Career driven – Triumph at your job
Episode 7: Better Together – The power of group investing
Episode 8: Make your networks shape your net worth
Season 1
Episode 1: Financial fitness – walk before you can run
Episode 2: Myths about investing
Episode 3: Baby steps… little is more
Episode 4: A cheque from the government
Episode 5: NSE – Taking stock of the market
Episode 6: Going offshore – cast your bread in many waters
Episode 7: Kenya’s black gold
Episode 8: Investor’s Edge – Saccos
Episode 9: How a wife’s wake-up call led Ken to make more money
FAQ’s
What is Buy Now, Pay Later (BNPL)?
BNPL is a payment method that lets consumers purchase goods immediately but pay for them in installments over time, often with little or no interest.
Who typically uses BNPL services?
BNPL is popular among younger consumers or those who may not have access to traditional credit options like credit cards or bank loans.
What are the benefits of using BNPL?
It offers convenience and instant access to products without upfront payment and can help build credit history if payments are made on time.
What are the risks involved with BNPL?
The ease of deferred payments can encourage overspending, leading to debt if users do not manage repayments responsibly.
Is BNPL suitable for everyone?
No, BNPL works best for people with steady incomes who can budget their finances carefully and treat BNPL as a real financial commitment rather than free money.
Conclusion
Buy Now, Pay Later is transforming how Kenyans shop and access credit, offering flexibility and convenience. However, it requires responsible use and careful budgeting to avoid the pitfalls of debt accumulation. By understanding how BNPL works and approaching it with discipline, consumers can harness its benefits to meet their needs without compromising financial health. The Make Money podcast provides valuable insights and tips to help listeners navigate BNPL and other consumer credit options wisely.
