"Buy Now, Pay Later" is the convenient version of personal loans. Instead of having to apply for a loan and go through a loan approval process, with BNPL, you can easily access it at checkouts on online stores. Both BNPL and personal loans are ways that people can make large purchases and pay them in installments. Unlike personal loans, which can last for 5 years and each payment is done once a month, BNPL loans are paid in four installment payments with each payment due every two weeks.

I believe that overtime, as BNPL providers get larger and achieve profitability, players like $AFRM will consider extending the terms of BNPL loans so they look more like personal loans. With that, BNPL will have a better shot at becoming an attractive replacement of credit cards, which is the main way people fund their purchases. By taking a bigger share of how transactions are funded, the BNPL industry can get a bigger share of the interchange fees that are already generated while giving their customers more than a month to pay off their purchase. But that vision is a long shot and the rewards that credit cards offer are more attractive than having the opportunity to maximize the time value of money concept when paying for my shopping trips.