Remember those times you wanted something cool but didn’t have all the money right away? Well, something called “Buy Now, Pay Later” (BNPL) has become super popular for that! Back in the day, it was mostly for buying stuff online, like clothes. But now in 2025, people are using it for all sorts of things – gadgets, doctor visits, even school fees and holidays! It’s easy to see why people like it, especially younger folks. But we need to take a closer look at how BNPL works and what it means for our money.
What Exactly Is “Buy Now, Pay Later”?
Think of BNPL as a way to buy something now and pay for it bit by bit later. Usually, you don’t have to pay any extra money (like interest) if you pay on time. It’s like a mini-loan that isn’t a credit card. Here’s how it usually works: you pay a small part of the price upfront (maybe a quarter of it), and then you pay the rest in a few set payments later on.
You’ve probably seen BNPL offered by companies like Atome, Grab PayLater, and Shopee PayLater here in Malaysia. Big global companies like Klarna and Afterpay also do this.
BNPL vs. Credit Cards: What’s the Difference?
You might be thinking, “Hey, isn’t that kind of like a credit card?” Well, while they both let you pay later, there are some key differences between Buy Now, Pay Later and traditional credit cards that are worth knowing:
| What They Do | Buy Now, Pay Later | Credit Cards |
|---|---|---|
| Extra Cost (Interest) | Often none for a short time | Usually high (you pay extra if you don’t pay it all back quickly) |
| How You Pay Back | Fixed amounts on set dates | You can pay a small amount or the whole thing |
| Checking Your Past Money Habits | Sometimes they don’t check much | They usually check to see if you’ve paid bills on time previously |
| How It Affects Your Future Borrowing | Might not always be reported, so less impact | Can help you build a good record if you pay on time, or hurt it if you don’t |
| Extra Perks | Usually none | Can give you points, cashback, or air miles |
| Late Fees | You might have to pay extra if you’re late | Yes, and they’ll charge you more interest too |
| Where You Can Use It | Lots of places now, but not everywhere yet | Accepted almost everywhere |
In short, BNPL is cool for buying something specific and paying it off quickly without extra costs. Credit cards can be better if you want rewards and more time to pay (but you gotta be careful not to owe too much and pay interest!).
Good Things About BNPL 😄
- No Extra Cost (Usually)
If you pay on time, you often don’t pay any extra money, which is better than regular loans. - Easy to Get
It’s usually easier to get approved for BNPL than a credit card, especially if you’re young or haven’t borrowed money much before. - Helps with Big Buys
If you need to buy something a bit pricey, BNPL lets you spread out the payments so it’s easier on your wallet each month. - You Can Buy Things You Might Wait For
Sometimes, BNPL lets you buy something now that you might have waited to save up for.
Bad Things About BNPL 🥲
- Easy to Overspend
Because it feels like you’re not paying much right now, you might end up buying more stuff than you planned. - Late Payment Traps
If you miss a payment, you can get charged extra fees, and it might even hurt your ability to borrow money in the future if they report it. - Hidden Fees
Sometimes, there can be other small fees you don’t know about, like for having an account or paying early. - Messy Money
If you’re using BNPL for lots of different things on different websites, it can be hard to keep track of all your payments, and you could end up owing more than you realize.
How to Use BNPL the Smart Way
- Only for Things You Planned to Buy: Don’t just use it for things you see and want right away.
- Treat It Like a Real Loan: Write down when your payments are due, just like a credit card bill.
- Don’t Use BNPL Everywhere: Try to stick to one or two BNPL services so you don’t lose track.
- Make Sure You Can Actually Pay: Look at all your bills and make sure you have enough money each month to cover your BNPL payments.
- Use Money Helper Apps: Some apps and online banks can help you see all your BNPL payments in one place so you know what’s going on.
BNPL can be a useful tool if you’re careful and know what you’re doing.
The BNPL Explosion and Its Effects
Buy Now, Pay Later isn’t just a small trend – it’s exploding around the world! Big BNPL companies are spreading fast, especially in Southeast Asia. Here in Malaysia, companies like Atome, Grab PayLater, and Shopee PayLater have become incredibly popular. Bank Negara Malaysia even reported that the amount of BNPL buying in Malaysia more than doubled between 2023 and 2024!
This growth is fueled by people seeking better money management with rising costs and the comfort of using financial tools on their phones. Plus, the desire for instant access to goods plays a big role. Because of this, BNPL is changing spending habits, often leading to larger and more frequent purchases, boosting sales for online shops (sometimes up to 30% more). In Malaysia, BNPL is now used for a wide range of items beyond just fashion.
However, experts are concerned that this easy access to credit could lead to people accumulating more debt than they realize, especially without proper regulation.
Staying Smart with BNPL: Rules and Responsibility
As BNPL grows, governments and financial watchdogs are paying attention. In 2024, Bank Negara Malaysia introduced some rules to make BNPL companies check if people can actually afford to pay back and be more transparent about their services.
The Credit Counselling and Debt Management Agency (AKPK) in Malaysia has also warned that while BNPL is convenient, it’s not a long-term fix and can cause financial stress if you’re not careful. They highlight that BNPL providers often don’t thoroughly check credit history or income, making it easy for young people to get into debt. AKPK advises financial responsibility, budgeting, and saving for purchases instead of relying on BNPL.
Ultimately, being smart about using BNPL is key. Treat it like borrowing, track payments, and ensure you can truly afford what you buy.
Wrapping Up: Spend Smart, Save Smarter with Versa
Buy Now, Pay Later can be a helpful way to buy things if you’re aware of how it works. Enjoy your purchases, but also prioritize your financial future. Building good financial habits is key to long-term security.
Just as you’re thoughtful about your spending with BNPL, consider making saving and investing a regular part of your lifestyle. Platforms like Versa can help you cultivate these habits, making it easy to grow your money over time. Having control over your money means enjoying today while ensuring security for tomorrow.
Start now by tracking your BNPL use, comparing it to other payment options, setting clear savings goals with Versa, and making your money work for you through investments. Buy with joy, but save and invest with purpose for a brighter future with Versa.
Versa has recently just launched a Fresh Funds Quest that incentivized users to build better financial habits! Simply cash in a minimum of RM1,000 fresh funds into any fund in Versa, you can earn +2.0%* p.a. nett booster on up to RM300,000 accumulated fresh funds cash-ins! Find out more about the Quest here.
Should you have any questions, please do not hesitate to reach out to us here. 💬