TAKEAWAY service Deliveroo now offers ‘eat now, pay later’ schemes – and opinion is divided.
The popular website has partnered with buy-now-pay-later (BNPL) giant Klarna to allow customers to pay for their food in instalments.
Meanwhile, competitor Clearpay offers Just Eat vouchers, although the latter does not have BNPL payment options.
The new schemes have proved controversial, with some claiming it is a “terrible idea” that could cause unintended consequences.
BNPL’s services are popular with customers as they allow them to spread the cost of items over a longer period, without interest or extra charges, unless payments are missed.
They are generally used for purchases such as clothing or can be convenient for essential purchases, but they also carry risks.
Critics say so-called “eat now, pay later” will encourage debt and unhealthy heating, while costing stranded customers more in the long run.
Dominic Arnall, chief executive of the charity Just Like Us, said: “Even as the plot of a dystopian novel, payback food would be laughably disgusting.”
Meanwhile, Twitter users slammed the move, with one writing: “I don’t know who needs to hear this but if you don’t have money for a takeaway you really shouldn’t be making your problems worse with Klarna.”
Another chimed in: “What stage of normalizing food poverty are we at now?”
Other concerns include BNPL’s effect on consumers’ credit scores and lack of customer protection.
BNPL companies are not yet regulated and therefore consumers do not have the same legal protection as using credit cards if there are payment problems.
Similarly, no complaints can be referred to the independent financial ombudsman, as they can with a bank or credit card provider.
Instead, issues should be resolved with the individual company.
It’s also important to note that takeout is often more expensive than delivery services, due to added restaurant fees and markups.
BNPL options are not yet available for grocery deliveries.
Klarna insists that this does not affect the customer’s credit score, but information such as payment holidays and existing, overdue and unpaid balances is visible on your credit file to other creditors.
A Klarna spokesperson said: “People have been paying for food deliveries with credit cards and overdrafts for decades, but have been stung by fraud fees and extortionate interest rates, so it’s time consumers had the choice of a healthier alternative where they always pay upfront purchase price.”
While a Clearpay spokesperson said its services are not available on the Deliveroo and Just Eat websites.
It added that it offers gift cards with a third-party provider, but they are only available to members who have “demonstrated responsible payment behavior.”
Carlo Mochi, Chief Business Officer of Deliveroo, said: “Millions of people already choose Klarna and we’re giving customers more choice and more flexibility with a safe and secure way to pay online.”