Point-of-Sale Financing is Another Step Towards Neoliberal Dystopia
Beware of installment payment plans!
They’re everywhere these days…
Over the past decade, there’s been a staggering surge in the “point-of-sale financing” market. McKinsey estimated these point-of-sale (POS) loans in 2019 accounted for over $100 Billion of the unsecured lending market, making them comparable to traditional personal loans. Companies like Arrow, Affirm, and AfterPay allow customers to “buy now, pay later” for goods ranging from groceries to exercise equipment to big-budget infrastructure projects. Instead of paying the full lump-sum all at once, buyers can pay smaller installments over a longer period of time.
On the surface, this appears to be a positive step towards financial accessibility. If someone needs groceries now but can’t afford the full bill until payday, then this piecewise payment model benefits everybody.
Customers win because they get what they need when they need it, and companies win because customers buy more stuff than they would have been able to afford otherwise.
