Finance

Problems with using buy now pay later for travel financing

“Buy now, pay later” services such as Affirm, Afterpay and Klarna can sometimes provide a cheaper, more accessible version of credit. These services essentially provide customers with an alternative way to pay for purchases over time without going into credit card debt or taking out a traditional personal loan. Travel purchases, such as airline tickets and vacation rentals, are the fastest-growing buy-now, pay-later segment. However, the Consumer Financial Protection Bureau warns that using it can be even more expensive. These services usually involve late fees and can cause passengers to spend more than they would otherwise.

Book a flight or hotel room now and pay later? It’s an increasingly common trend in travel spending. Companies like American Airlines , United Airlines and vacation rental website Vacasa now offer the option to book now and pay back gradually over time with “buy now, pay later” services.

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