Private Credit Fuels a ‘Buy Now, Pay Later’ Lending Boom in Asia
Governments are warning consumers about the risk of high-rate debt. Lenders say they’re opening up underserved markets.
A Kredivo ad in a Jakarta shopping center.
Photographer: Rosa Panggabean/Bloomberg
Maria Hazel Regalado, a 48-year-old mother of four in the Philippines, needed a computer last year so she could work from home. Regalado, who helps manage rental properties in Australia, didn’t have the cash or a credit card. A friend suggested she get a “buy now, pay later” (BNPL) loan from Billease, an online lender.
The computer cost 37,999 Philippine pesos ($664), almost as much as Regalado earns in a month. Still, Billease approved her application within minutes. She agreed to make 12 monthly payments of 4,493 pesos each, including principal and interest. The effective annual rate: 42%. “At first I was hesitant, but I didn’t have much choice,” says Regalado, who lives in southern Manila and had four installments left as of mid-July. “I really needed that laptop.”