Call to ban ‘buy now, pay later’ alcohol sales in Australia
- Delayed payment services do not often require any money up front, demanding minimum monthly or weekly repayments instead
The sale of alcohol using “buy now, pay later” services such as Afterpay and ZipPay should be banned because they encourage alcohol dependence and unmanageable debt, a health organisation has said.
In its submission to the Senate inquiry examining credit and financial services targeted at Australians at risk of financial hardship, the Foundation for Alcohol Research and Education (Fare) said the availability of alcohol at reduced upfront prices was concerning.
“Buy now, pay later services are not regulated under the national credit code, as no fees are charged for their services, no interest is charged on the debt/payment plans to the consumer and their loans are less than 62 days,” the submission states. “As a result of not being regulated by the code, there are no protections for the consumer such as responsible lending provisions.”
Some delayed payment services do not require consumers to pay anything on the date of online purchase but do require a minimum monthly repayment, while others require consumers to pay 25 per cent of the cost at the time of purchase, with further repayments automatically deducted every week.
“This enables people to make purchases that they cannot afford at the time, or potentially will not be able to afford in the future,” the submission says. “This is concerning in regards to consumables, as these items will have been at least partially consumed before payment is due. It is particularly concerning when extended to addictive substances such as alcohol.”
