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Summary

“Buy now, pay later” (BNPL) is a payment product that has emerged and seen strong growth in recent years. However, as...

Introduction

The emergence of BNPL

E-commerce has grown explosively in recent years together with various new payment solutions BNPL is a popular payment option in Sweden More focus on consumer protection than financial stability risks

Potential risks to financial stability

Risk assessment framework and methodology The payment product and checkout solution: Could be changed in the event of problems – at least in the short term Business model: Significant credit and technology risks limit profitability Risks to the financial system: Difficult to assess but driven by the providers’ indirect interconnectedness

Concluding remarks

Author: Nanna Svahn

About the Riksbank's Staff Memos

Staff Memo

A Staff Memo provides members of the Riksbank’s staff with the opportunity to publish advanced analyses of relevant issues. It is a publication for civil servants that is free of policy conclusions and individual standpoints on current policy issues. Publication is approved by the appropriate Head of Department. The opinions expressed in Staff Memos are those of the authors and should not be regarded as the Riksbank’s standpoint.

Buy now, pay later – a threat to financial stability?

September 2023

Staff Memo

September 2023

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