With buy now, pay later schemes becoming more popular than ever when it comes to buying gifts for special occasions or treating yourself, people are finding themselves in a debt trap.
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Welfare organisations have warned buy now, pay later users are purchasing items thinking they can afford to pay them off fortnightly but not considering other bills and their budget, leading to missed payments and late fees.
Mary Mackillop Today financial inclusion officer Sophie Tinning says she is seeing the financial hardship caused by buy now, pay later schemes on a daily basis in the local community.
"Unfortunately you see people being left short then having to take out another high cost loan just to get by, meaning they're spending more money than they were before," she said.
She also said surveys showed people were impulse buyers and most buy now, pay later schemes weren't regulated.
"When applying for credit cards people are checked to see if they can pay it back but with pay later, they're preying on the vulnerable.
"It's a lot harder when one fortnight you've left yourself short to pay a buy now, pay later payment," she said.
Ms Tinning also said, with online shopping, the purchase happens at the press of a button and was often not well thought out.
"People start buying things they don't really need and that can get you in trouble sometimes. People who purchase things like laptops can find themselves paying a couple of hundred dollars a fortnight.
"You've got to consider future budgets and if you really need the item there are other options," she said.
Ms Tinning's job allows her to help low income earners or those on Centrelink apply for No Interest Loans Scheme (NILS) and take a safer path away from debt.
The scheme offered a transparent, safe and affordable alternative to buy now, pay later schemes, she said.
Ms Tinning said Mary Mackillop Today had provided NILS in the community of Lithgow since 2000.
"There is no interest, no fees, whatever the item costs is what they pay," she said.
Items people can apply to use the money for includes household items, fridges, TV's, furniture, medical and electricity bills, plumbing and building repairs.
Ms Tinning also said car registration and repairs were other available options.
"We introduced car rego in July last year and it's been very popular, people are using it and coming here through word of mouth," she said.
She said applying for a no interest loan was different to buy now, pay later schemes because NILS allow low fortnightly amounts.
"We work out how much they can afford to pay back each fortnight even if it's just $20.
"Basically NILS is safe, affordable and fair they set fair repayments," she said.
Ms Tinning said Mary Mackillop Today wanted to help everyone where they could.
"If you really need the item first consider it then drop into NILS and have a chat and we'll consider better options for you.
"We genuinely want to help people, even if you're not eligible for a NILS loan we can see where you could become eligible in the future," she said.
She also said she understood people have pride and won't often ask for help but they should.
"People don't like to ask for help but because they're paying the money back even at a slow rate the dignity is still there," she said.
Mary Mackillop has recycled $3 million in Lithgow and the Central West through lending loans out again after they have been paid back.
Anyone in need of financial support can contact Mary Mackillop Today on 6352 3159 or email lithgow@marymackilloptoday.org.au