That “Buy Now, Pay Later” Service You Used May Be Harvesting Your Data

Today, as we kick off Data Privacy Week here at Confidently, we wanted to alert you to a new potential threat to your personal data privacy.

If you did any online shopping this past holiday season, chances are you’re at least familiar with “Buy Now, Pay Later” services like Afterpay, Affirm, and Klarna. Maybe you wanted to snag a limited edition pair of sneakers but didn’t have the funds, or even splurged to buy your spouse or kids a Peloton.

Then you saw an option on the checkout page: a way to complete your purchase without forking over hundreds of dollars at once. You went for it, and now, a few weeks later, you’ve still got promotional emails from companies you’ve never heard of swarming your inbox.

“Buy Now, Pay Later” services are an appealing option, especially for big purchases like furniture and exercise equipment, by allowing consumers to postpone payments or offering payment plans of smaller increments over time. But they also mean handing your personal data over to companies whose data policies are far from clear, many of which are facing a government inquiry into business practices including their use of customer data.

According to a 2021 survey conducted by The Ascent, over 55% of respondents used “Buy Now, Pay Later” services last year, up from 37% in 2020. Online vendors like Walmart and Target include the option to use one of these services at checkout, and they’re ubiquitous on social media marketplaces like Instagram and Facebook. Nearly half of Americans in their twenties don’t own a credit card, and young consumers (who do much of their shopping online) are increasingly taking advantage of the services’ largely interest-free payment options. The words “interest-free lending” ought to raise at least a faint ringing of alarm bells—after all, how else would these companies make money? The answer may have to do with your data.

Most “Buy Now, Pay Later” services state in their privacy policies that they do not sell customer data. Still, digital privacy-conscious consumers should be careful when choosing to use them. Last month, the Consumer Finance Protection Bureau (CFPB) opened an inquiry into the services’ lending practices and business models, expressing concern about how these companies use data collected from customers to create closed-loop shopping apps with partner merchants, pushing specific brands and products. If you’ve ever used one of these services and suddenly found your inbox and even text messages inundated with spam-like promotions, it may be because that company is sharing your data.

When you subscribe to Confidently, we instruct data brokers and big consumer brands to stop selling your data, which they are obligated to do under the law.

Between the pandemic and the steady building of digital commercial infrastructure, more of our consumption is moving online every year. Guarding your privacy in the online marketplace is a complicated task: It’s not as simple as just refusing to give your email at the checkout counter. 

But there are steps you can take to take back control of your online data. Whether that means staying informed about the services and platforms you use, or exercising your right to delete the data companies collect from you, Confidently has you covered.

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