Firstly, we want to reassure you that you’re not alone in looking for ways to make your festive budget stretch further. 4,377 Plymouth residents have contacted Citizens Advice for support with cost of living issues so far in 2025, and we tend to hear from more people needing debt advice in January due to Christmas costs. Here’s what you need to know if you’re thinking about using BNPL to manage your festive budget.
The most important thing to be aware of is that while Buy Now, Pay Later (BNPL) options are very easy to sign up for, they are still a form of money borrowing. This means that, just like with other credit debts, there are consequences for not repaying or not paying on time. These terms and conditions are not always very visible when signing up for BNPL at the checkout, and it may not be obvious that what you’re being offered is a BNPL option. This can lead to people being caught out by late payment fees and paying more in the long run, reduced credit scores and debt collection action.
BNPL works by giving you the option to spread the cost of what you’re buying online or in store. There are different BNPL providers, and different payment plans like paying in instalments, or paying the full amount at a later date. When you buy something this way, the BNPL provider you’ve selected pays the retailer for you, and you pay them back. As long as you make payments on time, you usually won’t pay any fees or interest for spreading the cost of your purchase. This has led to BNPL becoming a very popular option for shoppers, however there are downsides.
Unlike other types of money borrowing, you don’t currently have to complete affordability checks before signing up for BNPL. This can lead to people borrowing money they can’t afford to repay, building up debts to multiple lenders and ending up worse off than before. In addition, BNPL won’t be covered by consumer credit laws until new rules come in next year, meaning you have reduced protections if anything goes wrong.
That’s why it’s a good idea to explore other options first – especially if you’re considering using BNPL for essential costs like groceries. Contact us using the details below for advice on maximising your household income and reducing your living costs. If you do decide to BNPL, it’s really important to check your budget and make sure you’ll be able to pay according to the payment plan you signed up for. Our free budgeting tool can help you with this.
Another popular money-saving choice at this time of year is the Black Friday and Cyber Monday deals – but sometimes these ‘bargains’ are not what they seem. Some retailers increase prices ahead of Black Friday, then offer discounts that sound impressive but aren’t actually much cheaper than normal. Researching the normal price of any gifts you’re considering buying before the offers start can help you to work out if you’re genuinely getting a good deal.
On a similar note, remember that scammers often take advantage of the pre-Christmas rush. If a deal seems too good to be true, it probably is! Look out for pressure to buy quickly ‘while stocks last’ or ‘before offer ends’, and being asked to pay in unusual ways, like through a transfer service. If you’re buying from a site you haven’t used before, take a moment to check reviews on trustworthy external websites like Which? – don’t rely on reviews on the website you’re buying from.
Finally, if you’ve built up debt using BNPL, remember that we can offer free, confidential advice on your options for dealing with debt.
Get advice about any of the topics covered in this blog.