Social Media Use Linked to BNPL Adoption Among Students in Indonesia

TapTechNews, June 26. A study finds that the use of social media is closely related to whether people use the Buy Now, Pay Later (BNPL) service. The research surveyed 354 sophomore students from four private universities in Jakarta, Indonesia. The results show that the more frequently social media is used (especially among student groups), the more BNPL advertisements they are exposed to, and the greater the likelihood of using these services.

It is also pointed out that good family financial education can reduce students' willingness to incur debts by using BNPL services. However, if one is addicted to social media for a long time, even the positive influence from parents will be weakened.

In addition to the advertisements of BNPL companies, the mutual influence among friends on social media is also one of the factors that lead to an increase in students' debts.

Although extensive use of social media can weaken the effect of family financial education, the study still encourages parents to discuss financial planning and the responsible use of BNPL services with their children. The research also suggests that universities should inform students of the negative impacts of BNPL services, such as interest and the long-term consequences of poor debt management. Finally, the study suggests that financial regulatory agencies should introduce relevant regulations for BNPL services, especially for people with fixed incomes, to avoid default events.

According to TapTechNews, the Buy Now, Pay Later service is a relatively new payment method. Users can obtain the goods in advance and then make installment payments. When repaying on time, users only need to pay the cost of the goods themselves. But if the repayment is missed, the BNPL service will charge a late fee, and long-term overdue debts may be sold to debt collection agencies.

Compared with other loan products, the BNPL service has a shorter emergence time, which means that consumers lack sufficient financial protection during the use. In order to avoid falling into the debt trap of Buy Now, Pay Later, perhaps developing good saving habits and living within one's means is a wiser choice.