As a society, we've financed houses, we've financed large appliances, and we've financed furniture. In 2023, we're financing couture. It's not just one company, either— Afterpay, Sezzle, Affirm, and Klarna all offer "buy now, pay later" options on a variety of websites. Overall, this increases the accessibility of slow fashion, so it should be a good thing, right?
The answer is a little more complicated than a simple yes or no. Services like this do impact your credit score, which can be a slippery slope for some. There are plenty of ways to make high fashion clothing more accessible without standing a chance of wrecking your credit score. Rent The Runway, resale websites, and high end vintage/thrift stores all offer accessibility of high end goods to everyone.
Afterpay has specifically targeted the fashion consumer, as they even have a fashion week section on their website. This section offers a live "watch and shop" section, where fashion fanatics can purchase garments right off the runway via Afterpay. The company is also a sponsor of Australian Fashion Week in 2023. The Australian Fashion week website offers an opportunity to purchase tickets for fashion shows utilizing Afterpay. Along with these sponsorships and appeals to the fashion world, Afterpay and similar services have crossed potential ethical lines with the incentives they've offered to consumers.
If you google anything about Afterpay and the fashion industry, one of the first pages to come up will be positive press that Afterpay published on their own website. So, why is Afterpay targeting the fashion consumer specifically? Essentially, Afterpay is attempting to reach clientele that they previously didn't have access to. In the early days of these services, they were only available at lower price retailers like Urban Outfitters, Anthropologie, and Free People.
As Afterpay saw their customers flock towards fashion, they quickly expanded their market. This now includes designer brands like Jimmy Choo, Furla, and Anna Quan. These partnerships increased revenue for both the fashion companies and Afterpay by allowing a new type of clientele to be available to these fashion houses.
I don't think there is necessarily an ethical issue with these Afterpay services existing in the first place. The ethical questionability lies within the incentivizing of purchasing things on credit. These services are known to offer small discounts for your first purchase with them, which can very quickly lead to more purchases on credit. These payments aren't spaced out like a typical financed item, either.
In the case of technology and appliances, typically a monthly payment is made to a principle amount that either does or does not accrue interest. However, through these services payments are made on a bi-weekly basis. Coincidentally, most jobs are paid bi-weekly. Afterpay wants these payments to seem convenient and alluring to the consumer, and that's exactly how they appear.
Afterpay does actually offer an option to pay monthly instead of bi-weekly. The company does not check or impact your credit when making bi-weekly payments, but if you select the monthly option, you will have your credit checked, and therefore impacted. The monthly payment option is also accompanied with interest in order to de-incentivize their consumers from selecting it.
Buy now, pay later is an alluring concept, but when mixed with all of these seedy ethics it can become hard to know if you're being a smart consumer or not. Making purchases on credit can be a good way to build your credit score, but should only be made when accompanied with realistic and achievable payment plans. And it's up to the consumer to decide what fits this bill for them. Afterpay adds a lot of accessibility for consumers, and can be very helpful as long as we are all mindful of ourselves and the ethics surrounding the service.