Several months into the pandemic last year, Zachary Sempek and his new wife were desperately craving a vacation.
Their wedding had been rescheduled multiple times, the honeymoon scuttled by Hawaii travel restrictions. And they were still grieving the death of her father in late 2019 from cancer.
“We felt we sort of deserved a week off to relax,” the 29-year-old insurance claims worker said.
Money was tight, and they didn’t want to dip into wedding cash earmarked for Hawaii or put the $1,500 vacation package to San Francisco on a credit card. So when Southwest Vacations offered the option of a monthly payment plan during online checkout – something Zempek had only previously seen for retail purchases – they jumped on it, high interest rate and all.
“Having everything just simplified into one low payment worked,” Sempek said.
Buy now, pay later plans, a high-tech twist on layaway plans except buyers get the goods (or vacation) upfront instead of when paid off, have exploded in popularity for online shoppers buying everything from clothes to pricey exercise equipment like a Peloton bike.
March spending via payment programs from Affirm, Afterpay, Uplift, Klarna and others grew 166% over the same period in 2020, and year-to-date growth is tracking at the same rate, according to new statistics released last week by Adobe Analytics.
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The percentage of online transactions using buy now, pay…