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Misleading marketing, late payment fees, and unaffordable debt are just some of the ways Buy Now Pay Later (BNPL) products exploit financial vulnerability.

Thursday 10 November 2022

According to a new report released today by Good Shepherd Australia New Zealand, 60 per cent of its Financial Counselling and Capability practitioners, estimate that around half, most, or all their clients have BNPL debts and 73 per cent have clients who have missed essential payments or cut back on essential items just to make repayments.

Good Shepherd Director, Research, Advocacy and System Impact, Dr Ros Russell said that the research highlighted that BNPL was commercialising the social safety net and in the absence of suitable, safer alternatives or adequate social security payments, that some women were forced to use BNPL products to flee abusive relationships. “We know firsthand that too many of our clients using BNPL products are suffering financial stress and hardship and that they are using them for life’s essentials for things like food, electricity bills and nappies,” Dr Russell said.

“And while these debts are problematic for the general community, the consequences can be even worse for victim-survivors of family violence. We know that economic insecurity can leave women with no other choice than to return to an abusive relationship.”

The report also found that 25 per cent of practitioners see coercive/abusive debt in at least half of their clients using BNPL. Single mother, *Sonja said it was her abusive ex-partner who encouraged her to take out multiple BNPL accounts and racked up over $6000 worth of debt. “I was in a violent relationship and was financially controlled for a long time. He made me take out Buy Now Pay Later accounts again and again, and they were just approved,” she said.

“Eventually, I put my foot down – I didn’t have the money to pay for the debt outright, which is why I needed help from Good Shepherd’s financial counselling services which has supported me to become financially independent.”

Good Shepherd Australia New Zealand Family Violence Financial Counsellor, Holley Dumble said that because these companies are exempt from the National Credit Code (NCC), there are less rights and protections for consumers, which leaves them exposed. “Even where clients are showing clear signs of hardship, BNPL providers are not obliged to provide hardship support. While some providers are voluntarily offering hardship programs, BNPL hardship assistance is inconsistent and largely inadequate,” Ms Dumble said.

Good Shepherd is calling for the development of regulatory regime that prevents unaffordable BNPL debts, unmanageable multiple accounts, and misleading marketing.

“Better regulation would protect women against abusive and coercive BNPL debts, for example accounts fraudulently set up in their name by abusers, and mandate consistent hardship and family violence support by all BNPL providers,” Dr Russell said. “We need to close regulatory loopholes and plug safety net gaps to ensure women, girls, and their families are safe, well, strong and connected.”


*If you cover this story, or any story regarding family violence:
“If you or someone you know is impacted by sexual assault, family or domestic violence, call 1800RESPECT on 1800 737 732 or visit In an emergency, call 000.”

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