In the past, the concept of borrowing money or borrowing was done conventionally, such as borrowing from friends, family, and relatives. Some of them are afraid to borrow from a bank because of the interest and large collateral. However, now the concept of debt can be done online and packaged attractively. The concept is in the form of a feature known as Pay Later.
The main reason for the Pay Later feature is that it is popular because it can be used to pay for various transactions such as food purchases, daily transportation, traveling, to consumption products. Thus, indirectly the Pay Later feature can be referred to as an alternative payment process that is fast and easy.
Then, what are the advantages and disadvantages of this Pay Later feature? Let’s understand before using with the following reviews!
The process is faster and more practical
Shown with an attractive package, the Pay Later feature is prepared to get funds faster, easy terms, and quick registration and activation. Prospective users can simply download the application on their cellphone, register themselves, and funds are ready to use.
If you are in an urgent situation, such as buying an electric token, buying medicine, to traveling tickets for business trips or family affairs, the Pay Later feature is very helpful. All you have to do is click on the Pay Later feature and without waiting for a long time all your needs can be fulfilled immediately.
Many Interesting Promos
Promo, who is not tempted to hear the word? Now if you owe using the Pay Later feature, you can get more attractive promos than paying cash. Due to the popularity and rapid development of the Pay Later feature, there are many application companies that are competing to provide special promos if users choose a payment method using Pay Later. Favorable, right?
Before clicking the pay button on the Pay Later feature, make sure you have read the terms of the tenor installment that will be paid. Some application companies usually provide various installment tenor options, ranging from one month to twelve months. This means that the Pay Later feature can be used according to your needs and ability to pay.
In every advantage there must also be losses. Some of the conveniences offered by the Pay Later feature could be a disadvantage of the feature itself you know.
Potential to Add Debt and Become Wasteful
The concept of buying now pay later from Pay Later can trigger users to be wasteful or impulsive buying. One contributing factor is that users may not think long in buying an item or service. Because it considers Pay Later features can be paid at the end of the month, users can buy whatever they want and do not realize that the bill to be paid is very large and even add to the debt.
Messy Financial Flow
You need to pay for this using Pay Later, if you still don’t download other applications, register again, use again and so on. By continuing to depend and be addicted to using the Pay Later feature, it can make the financial flow messy. For example, income that has been set aside for other needs is instead used to pay Pay Later installments. This can create a high risk of being unable to pay.
Decreased Credit Score
Had touched on if Pay Later is an alternative payment from a credit card. Even so, there are still major impacts that you will get such as credit scores in banks. If you are late or unable to pay on time, the effect on credit reputation records or bank credit scores will decrease. As a result, if you want to apply for a loan for more important things such as home loans or business capital can be threatened rejected.
Identity Security Threats
Digital transactions certainly do not escape the danger of hacking. Although every Pay Later application company has used the most sophisticated security system, cybercriminals are able to find ways to hack into the user’s account database for irresponsible matters, burglary of funds to fraud. For that every user must be careful in maintaining data security in the Pay Later feature that is owned.
Interest and penalties
Just like a credit card, Pay Later loans also apply installment interest to be paid. Even if late to pay, there are fines that need to be paid. The amount of interest and penalties paid by users will vary depending on the application company that provides it. So, make sure in advance the provisions on interest, penalties, and other fees set by the Pay Later application company. Understand and use according to ability.
Those are some of the advantages and disadvantages when using the Pay Later feature. Keep in mind that Pay Later serves as an alternative payment in urgent circumstances so we need to be wise in using it so as not to burden later on.