MUM-OF-TWO Jenny* relies on buy now, pay later firm Zilch to buy basic items like nappies, milk and food for her young kids. 

Her family is just one of many who now rely on BNPL finance as a way to survive.

She has just £300 to pay for food and other household essentials once her rent and bills are paid. 

 “I feel a bit of a failure as a mum. I’ve had these children, I’ve put them in the world, I’ve got to feed them and look after them – but then you don’t know if you’ll be able to,” Jenny says. 

 “With the way food prices are at the moment, that’s not even covering two weeks worth of food. So it’s a struggle”. 

 “I’m not buying TVs and unnecessary stuff. It would be bread, milk, nappies, fruit, vegetables, meat, packed lunch stuff. It’s a constant cost.”

Jenny spoke to BBC’s Panorama as part of their investigation into the Buy Now Pay Later industry. 

 The documentary reveals nearly 30 per cent of the adult population regularly use Buy Now Pay Later, an increase of 2.6 million people since last Christmas.

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The research, by global data company Equifax, also found shoppers spend as much as 51 more than those paying upfront. 

While Jenny says having the option to Buy Now Pay Later is convenient, she says it’s “a sad state of affairs when you’ve got to rely on it to be able to pay for food”.

Her family’s financial situation has taken a hit in recent months after their rent was increased and the cost of energy bills, petrol and food soared.

"A couple of months ago I desperately needed to get some milk and a few bits of soap at lunch and I had nothing in my account but a little bit of credit available on Zilch, I think about £20.

“I had to contact my mum to ask for the fee to use it, because every transaction outside of online costs £2.50. So I had to ask her for the £2.50, just so I could use it.”

Jenny says the situation has left her feeling “heartbroken” – but she’s not the only one struggling with debt. 

In the first eight months of this year, the average household debt in the UK rose by more than a thousand pounds, to £17,283. 

Now Jenny is worried about keeping on top of her BNPL repayments as she’s stuck in a cycle of debt. 

She adds: “I have a sort of breakdown once a month. I just try to work out when I’m about to pay the next repayments, whether I can then afford to pay the next ones. So it’s had quite a big impact on the family.”

As well as Zilch, Jenny is also signed up to Clearpay, which she has previously used to buy clothes, and has access to around £1,000 in credit across the two providers. 

While she only uses them for essential purchases, she says having access to that amount of credit could be a slippery slope into serious debt.

“That would take me a long time to repay,” she says. “We have income coming in and its monthly income. So I would not be able to repay that at all.”

Simon Kendall is an independent debt advisor, who helps people with problem debt in Leeds. He says many of his clients are already heavily in debt before they sign up to Buy Now Pay Later.

He told Panorama: “The industry's gone absolutely massive and there's been a big boom. I would say about 30 to 40% of my clients have used it in some form, whether it's on this short term, quick fix sort thing or whether it's small, long term and it's a regular thing for them.

"I'm seeing probably more increase in families using it to get by, thirty to forty years old. 

“So clients aren't coming to us because of Buy Now, Pay Later, that's usually the tip of the iceberg.

"There's normally some underlying issues – payments to Buy Now Pay Later products are worse than them, making their financial situation even worse.

"Some of these clients should never have been able to apply in the first place.”

In September 2020, the Financial Conduct Authority (FCA) commissioned a review, led by Christopher Woolard, which recommended the industry should be regulated to ensure better protections for its users.

The Government told Panorama it was considering the most effective way to bring such products into the scope of regulation and was trying to work through this as quickly as possible.

Zilch says: “Today’s consumers are driven by convenience and will choose to shop and pay in ways that are easiest and most affordable.”

It says it “combines open banking with soft credit checks so credit scores are unaffected.” 

Clearpay says credit checks don’t work for “small everyday purchases”. 

Instead, it says “we build trust with our customers, they start on lower amounts and these limits only increase when we see ongoing positive payment behaviour.” 

Watch BBC Panorama Buy Now, Pay Later: The New Debt Crisis? on BBC One at 7:35pm tonight, and on iPlayer afterwards.

*name has been changed

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