But, experts are concerned that the limited checks surrounding the loans will put many Aussies into debt they cannot afford.
Afterpay Plus is a subscription that costs customers $10 a month that links your Afterpay account with Apple Pay, Google Pay or Samsung account.
This means that shoppers using one of these payment services, which are accepted at most major retailers and supermarkets, can activate an Afterpay loan with limited checks on whether a loan is appropriate for the customer.
Financial experts believe this means that BNPL products are spreading throughout all sectors of the economy.
Experts are worried that by making loans easily accessible, more and more Aussies could get themselves into financial troubles, particularly during a cost of living crisis. More and more Aussies are using BNPL services for necessities rather than just discretionary items.
Speaking to CHOICE, CEO of Financial Counselling Australia, Fiona Guthrie, said: “You'll just be able to use your Afterpay Plus card because it's just tap and go and I guess the more seamless it becomes, the less people kind of stop and think about it as a product and taking out a loan. People don't think of it as credit, generally, but you're using someone else's money.”
CHOICE head of campaigns and mobilisation, Andy Kelly, said that BNPL loans “are still poorly regulated and don’t come with the same consumer protections as other forms of credit, such as requiring lenders to conduct safe lending checks and to have good financial hardship policies for people doing it tough”.
“Afterpay Plus takes poorly regulated loans, combines it with a costly subscription model, and allows people to sign up for a new loan just by swiping their phone at the checkout.”
Kelly also explained that the Afterpay Plus policy deters people from cancelling by stipulating any customer that unsubscribes from the product will be banned from using it for 12 months. This could scare customers into keeping the subscription. This policy also allows Afterpay to avoid regulations as a credit product.
Many experts are calling on the government to close the legal loopholes on BNPL in order to protect customers.
