Hello Grasshoppa,
Recently, many companies are offering Buy Now, Pay Later (BNPL) payment plan where you are able to purchase the item you want & pay it within 3-6 months via instalment. Some companies even offer you to purchase now & pay it a lump sum the following month. There are many thoughts & views by Malaysians on how good or bad BNPL is for them.
Usually, when it comes to new trends, I won’t be the first who will be aware of all these until when the trend is booming. As for BNPL, I have activated my BNPL under Grab for the past few months as they are offering an extra voucher when I activate BNPL for my account. Honestly, I was not a fan initially as the amount for BNPL that they were offering was very low. I remembered they allowed me to split my bill for my Zalora purchase via Grab which was worth around RM25. Why would I want to split the payment for such a small amount? I remembered my recent purchase of a Rode Wireless mic during the 8-8 Sales where Shopee actually did not accept ShopeePay & somehow only their SPay Later was allowed. Since I was purchasing it at 12 am, I actually went to bed & woke up to continue my purchase. In my opinion, I don’t think it is a glitch error from Shopee but they may do it on purpose so other users can use their SPay Later service.
Although BNPL is a new trend, the credit card is has been offering something very similar for the longest time. Some of us may have used our existing credit card facility for 0% instalment where we are able to stretch our payment between 6-24 months. Personally, I am one of those who will make my purchase by stretching my payment since it is a 0% instalment. Why not? It is actually good for my cash flow where I can plan my money & cash flow better. For those who are making purchases with credit card 0% instalment, please plan your finances ahead before you make those purchases rather than buying things you can’t afford. That used to happen to me where I abused my credit which I ended up having a huge amount of debt in the past.
Similarly to BNPL, I believe that all of us should use it to our advantage rather than purchasing it despite struggling to pay now or later. It can be your best friend if you are using it well but it can also be your enemy if you abuse it. If you are looking to use it to your advantage, the first tip is to ensure that you can afford to buy it. For example, you are looking to purchase a new iPhone that’s worth RM5,000. Whether you are using BNPL or credit card 0% instalment, look into your bank account to see if you have at least 80% (RM4,000) & above of that total amount of free cash flow. It is important to know how healthy your finances are before you make those purchases. If the answer is yes, next you will need to come out with a plan on how to pay it. Do you have that extra cash to pay on a monthly basis for that instalment? If yes, you can go ahead to make the purchase. Personally, I prefer to see my bank account to have a sufficient amount of money before I make those purchases.
Is BNPL bad for Malaysians? I have made my first purchase recently using BNPL. Since most of us are WFH, having a good desk & chair is important for you. Since April this year, I have spent 99% of my time working from home &, to be honest, my current chair is not the best chair for me to sit in all day. It is either I am working on the bed or working from my dining table which is a high table with a bar stool. I decided to buy a new work table & a good gaming chair so that I can sit comfortably which has led me to purchase an OSIM uThrone gaming chair where it has a massage function as well. The retail price for the chair is RM2,988 but with BNPL, I am able to enjoy an RM200 discount. It is a good deal that was offered by Pace where I will be paying in total RM929.33 for the first & second payments & the third is RM929.34. My original plan was to purchase it via my AirAsia card to collect Big Points & but I ended up purchasing it via BNPL through the PACE app. I am able to earn Big Points since my Pace account is linked to my AirAsia card & I am able to earn an RM200 discount. It is a good deal.
Should you use BNPL for your purchase? The answer is yes if you are able to get some benefit from it such as a discount but before you make your purchase, please make sure you have at least 80% of the purchase amount in your free cash flow & a plan on how you plan to pay back for the subsequent month.
OSS!
You can also check out my latest YouTube video on How To Spot An Investment Scam In Malaysia:
