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Is ″Buy Now, Pay Later″ the consumer credit magic bullet we’ve all been waiting for?

BIScom Subsection: 
Author: 
Nigel Morris-Cotterill

Buy Now, Pay Later is a rapidly growing consumer credit sector. Last year, it is reported, it was used in 3.6% of retail sales in the UK. Is it a panacea or a plague?

Long Read: 17 pages.

Loyalty cards to ChargeCards

Many chainstores launched loyalty cards precisely to gather similar data on purchases that GUS had identified; as chainstores formed conglomerates, a very comprehensive picture of entire families and their spending, volumes and values as well as items, was built up.

Many chainstores launched their own credit cards as a development of the loyalty card but shop credit cards were often nothing more than branded cards from secondary lenders. They were known as ″Chargecards.″ Interest rates were often significantly higher than a mainstream credit card. One of the first independent chargecards in the UK, i.e. not a rebranded card from a secondary lender, was the M&S Chargecard launched in 1985. Unlike many forms of credit, it had a certain cachet about it. Over the years ″St Michael Financial Services″ as it was originally called, began to offer a wide range of services. In 2004, it was bought by HSBC and, in 2012 became a bank in its own right as a joint venture with HSBC. Although it has branches and a wide range of services, in early March 2021, the bank announced that it was to close all current accounts, and some others, plus branches in its shops, many of which had had very patchy opening hours during the past year due to CoVid-19 restrictions and a general migration to on-line banking as people have stayed at home.

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