In efforts to reduce the British public’s use of Buy Now Pay Later (BNPL) schemes, Claro has launched its ‘Bye Now Pay Later’ campaign.
The campaign will use a series of digital billboards featuring shocking statistics on the financial habits of society, at prominent sites in London, including Oxford Street, London Bridge, Canary Wharf and Westminster.
An advertising van will also be visiting the country’s most famous high street, Oxford Street, the ASOS head office, Boohoo London office, Klarna and ClearPay head offices.
On PerformanceIN, we have discussed how BNPL schemes are on the rise, especially throughout the pandemic, meaning the recent Woolard Review and subsequent Financial Conduct Authority (FCA) plans for regulation of BNPL schemes are so interesting.
What are the stats?
The statistics featured in the campaign are from Claro’s own research, published in its Mental Health Project report, created in partnership with Mental Health UK and The Money Charity, which found:
- 41% have been living beyond their means at some point over the last 12 months,
- 20% of households couldn’t last a month if they lost their main source of income, without needing to borrow money,
- 29% of 18 – 30 year olds don’t use a budget to manage their income and expenditure.
Rob Brockington, CEO at Claro said: “Unconsidered spending and an overreliance on unsecured financial products, such as Buy Now Pay Later schemes, can ruin people’s personal finances for years. We want to reduce this reliance, and remind consumers that they have a choice in how they save, spend and invest their money. Our ‘Bye Now Pay Later’ campaign is aiming to raise awareness of the benefits of better money management for everyone, regardless of their income, bank balance and social standing.”
Claro is also inviting BNPL providers and retailers to a meeting to explore ways of promoting considered spending among the public, and educating people on unsecured credit products.
The financial coaching app believes that there is a place for BNPL products in the market, however it should be used occasionally, rather than relied on. Issues can begin if a regular habit of using these products is made. Better awareness and education are needed to prevent an overreliance on these facilities.
Dr Mark Fenton-O’Creevy, Professor of Organisational Behaviour at Open University Business School (OUBS), said: “Buy Now Pay Later products, especially when accompanied by an “interest-free” headline offer, can be particularly appealing to cash-strapped consumers.
“Some BNPL offers are in good faith, with the win-win aim of allowing customers to spread payments affordably whilst increasing sales. However, others amount to worryingly ethically questionable practices.”
It will certainly be interesting to see how the campaign affects the usage of these schemes, especially as in-person shopping is on the rise and we’re heading into the festive period.