BNPL services fuel debt concerns in the United States and Malaysia

Buy‑Now‑Pay‑Later (BNPL) providers in the United States originated roughly $157 billion of consumer credit in 2025, up from $116 billion in 2024. A July survey found that 44 % of American respondents plan to apply for a BNPL loan within six months, with many using the product for essential purchases such as groceries (29 % of users), medical or dental care (42 %), and utility bills (39 %). Late‑payment rates have risen, with 47 % of users reporting missed payments in the past year and fees that can push effective annual rates above 100 %.

In Malaysia, officials say that BNPL and unsecured personal loans have driven a surge in youth bankruptcies. Since 2022, 3,876 young people – many under 25 – have been declared insolvent after debt exceeded RM 100,000, accounting for 14.48 % of the nation’s 26,782 bankruptcies over five years. Director Datuk Ishak Bakri highlighted social‑media‑driven spending pressures and the ease of obtaining multiple credit cards as key factors. The first half of the current year alone saw 74 new youth bankruptcies, underscoring growing concern over unsustainable borrowing habits.