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With influencers promoting products alongside direct purchase links, impulse spending has never been easier.

While it can serve as a convenient way to spread the cost of highly priced items, pay-later platforms have now quietly turned into a trap for everyday spending. 

‘Buy Now, Pay Later’ platforms are increasingly being used to cover routine expenses, including takeaways, clothing, and even basic toiletries. 

However, experts are warning that these micro-loans can spiral out of control for many, creating long-term credit risks that could ruin hopes of securing a mortgage or car loan.

Speaking on Live 95’s Limerick Today, Leah MacMahon, a financial planner at Castle Capital, is urging people to recognise that these BNPL services can create short-term debt. 

Addressing how quickly these platforms have integrated into daily habits, MacMahon pointed to the psychological tricks that make BNPL so enticing, particularly the concept known as the ‘pain of paying’.

“When you physically hand over €100 in cash, you are far more likely to think twice about whether a non-essential purchase is worth it,” she explained. 

“When you split that cost into three payments of €33.33, it takes the sting out of spending. You get that short-term dopamine hit of getting the item immediately, but over time, dozens of these small payments pile up and take a massive bite out of your discretionary income.”

MacMahon said that moving away from cash and seeing default BNPL options integrated into nearly every online checkout has normalised buying goods on credit without a second thought.

The rise of social media marketing and influencer culture has further heightened BNPL usage among younger consumers, including students and teenagers. 

MacMahon spoke about a recent transition-year workshop where a student as young as 16 admitted to already using BNPL services.

“Some younger generations are particularly susceptible because they might be working part-time, preparing for events, or simply don’t have €100 today, but they have €33. It really comes down to financial literacy, understanding what you are committing to before clicking through.”

While a missed payment on a takeaway order or cosmetics purchase might feel insignificant in the moment, the long-term consequences are severe. 

Because BNPL options function as formal credit agreements, missed or late payments are flagged on personal credit reports.

“The worst-case scenario is that building up BNPL debt and failing to pay it back puts a black mark on your credit report,” MacMahon warned. 

“That can prevent you from getting a loan from a bank or credit union, including car loans and mortgages. Once that mark is on your record, it can take up to five years after the debt is cleared before you can apply for a mortgage.”

Problems that can arise from BNPL usage include the use of credit for non-essential everyday items, direct debits bouncing due to unknown withdrawal dates and feeling overwhelmed by multiple recurring micro-repayments every month. 

For those struggling with spiralling micro-debts, she advises stopping all new agreements immediately, making a clear list of all outstanding repayments, and consulting a professional financial planner or reaching out to services like MABS (Money Advice and Budgeting Service) for free, confidential guidance on debt consolidation and budgeting.