All right have you ever used a buy now Pay later option well the Consumer Financial Protection Bureau just Announced additional protections for Those of you who do providers must now Offer some of the same protections that Are afforded to credit card users and That includes the right to dispute Charges and demand refunds for returned Purchases CBS News senior business Technology correspondent jooling Ken is Back in studio 57 I don't know how she Does it East Coast West Coast all the Time to help break this down for us what Are these new protections and and how How much muscle is that really behind Them essentially what we're seeing here Is a decades old law the truth and Lending act now being applied to these Byy now pay leader platforms and so what You're going to see is similar Protections offered when you're using Your credit card or even your debit card And so we're talking about regular Billing statements you'll also be able To dispute charges and we know that a Large percentage of buy now pay later Transactions have actually been disputed Or returned over the past several years And there have been a lot of Hoops that People have to JP through so the cfpb is Basically saying look now consumers can Rely and say if I want my money back on Something something has gone wrong
Whether it's a product or a service you Can get that and I just want to get a Sense of who's using this because I Remember layaway used to be a big thing That seemed to go away and now there's This buy now pay later situation are They the same thing and and how does That compare to uh to like credit cards Because I know that you actually Interviewed the head of the Consumer Financial Protection Bureau what did you Learn so basically credit cards are an Infinite number of payments if you don't Pay off your balance right away whereas Layway is you'd put the item on hold and Then you would pay installments and then Get the item at the end buy now pay Later is you get the item at the point Of purchase UPF front and then you agree To say four payments over six weeks time And it's a no interest typical agreement With you know affirm Clara PayPal for Any number of these compan those options Yes and you're now seeing them not only Online but you're seeing them in store So the director of the cfpb is saying They basically want to make the rules Very clear because they're seeing some Blurring of lines here they want Consumers to be protected obviously the Buy now pay later platforms also have Their you know position on this and They're trying to also sort out where They fall when it comes to your credit
Score and how that's reported whether You're not making the payments or you're Paying in in good faith and similar to Credit cards the types of people that Tend to use these things they tend to be Younger and they tend to not have the Funds on hand to make the payment right Away I think we had a stat we just Showed that um half of those who shop um Between the ages of 25 and 44 use um This type of feature so how important is It for the more vulnerable people and The folks that don't have as much money In well what we've learned from what the Cfbb has told us because they've been Receiving complaints over the years About these kinds of products and what They say the director Rohit choer told Me in our exclusive interview that People who live paycheck to paycheck Lower income individuals are often Bearing the brunt of the problems and The issues that these kind of companies May come with if you're not making a Payment on time or if there's confusion About a product or a service or how You're making your payment and so what We see here is lower income individuals Often are hit the hardest but what we're Also finding is if you look at the Macroeconomy right now you look at Everything that's going on more and more People are using buy now pay later for Grow groceries for some Essentials
Because inflation continues to be so Persistent even though the rate of Inflation is cooled off as we've Reported it's still very expensive and Cost of living is still very high that Is why so many consumers are shifting to Buy now pay lader it's an inter three Option to give you a little bit more Freedom to stretch out your payments Cfpb is saying watch out make sure you Understand the rules and protect Yourself yeah great uh get with this Interview and there'll be more on the CBS Evening News tonight into all of These issues and even more detail Tonight on the CVS Evening News Ken Thank you so much
