40% of those getting into problem debt with Buy Now Pay Later loans are under 30

New analysis by free debt advice provider Financial Wellness Group, shows that people using Buy Now Pay Later (BNPL) loans are getting into problem debt younger. The average age of customers seeking debt advice with BNPL debts is 34, compared to 37 for those without BNPL debts. In fact, 40% of BNPL customers seeking debt advice from Financial Wellness Group are under 30.

The average individual BNPL loan is £268, up from £250 a year ago. Whilst women (55%) are more likely than to get into difficulties with BNPL than men (45%), men tend to borrow more than women. On average men seeking debt advice with this type of debt had 1.2 loans with a total value of £408. Women, by contrast, have an average of 1.3 loans but a lower average total loan value of £280. Whilst the majority of advice seekers have just one BNPL loans amongst their debts, some have as many as 12.

Whilst making up just 17% of BNPL advice seekers, people aged 41-50 have the highest average BNPL borrowing – of £402.

Deborah Ware, Chief Operating Officer of Financial Wellness Group, commented: “A year ago we warned that BNPL lending was encouraging younger people with less experience of borrowing to get into debt, particularly women. Our new figures show that 1 in 5 seeking debt advice with BNPL debts are women under 25.

“Earlier this year, the Treasury accepted the recommendation in the Woolard report that BNPL should be regulated by the FCA. Whilst we appreciate that it will take some time for the regulator to draft, consult on and implement those rules, this can’t come soon enough.

In the meantime we urge people who are struggling with the repayments on BNPL loans – or any other lending – to seek advice sooner rather than later. The quickest way to find free and unbiased debt advice is via the Money Advice Service.