My experience is different from the lasts posts. I have been using Flex for some months and I love it. I used to pay everything with credit cards, which I pay the full balance statement very month, but I am now using Flex much more instead of my Amex, Jaja and others for larger purchases. Very handy during Christmas.
I track everything in a spreadsheet and have no problem in having full visibility of money going out each month.
My only problem with Flex is the recent recategorisation of Flex payments to ‘transfer’ which messed up with my categories. because of that categories/trends now are almost useless for me.
Can I ask what is perhaps a silly question to those who mention closing flex: is there something about flex specifically that is more of a temptation than a CC? Maybe I just don’t quite get the BNPL concept, because to some extents that is what a CC is but just with a bit more flexibility.
If I buy something for £500 on my credit card, I’ll know I have to be able to pay that £500 off in full at the next statement date (because I never pay interest).
But with Flex I can split that £500 into 3 payments, interest free, so it makes it more manageable and easier to overspend. And if you’re not careful then you can end up with a lot of those payments adding up into more than you can afford in one month.
(Not saying this is a problem for me, but can see how it happens)
I’m team Ethan on this one, sorry revels! (Still rooting for you in the battle of the Dan tho)
The flex approach is both simultaneously easier to snowball, and can invoke a bit of sensory overload. One small miscalculation can snowball very quickly into something insurmountable. And in those situations because of the way it works, and can be seen as a useful tool to get out of it too which could actually wind up doing the opposite, making it harder to get under control. One thing they could improve to mitigate some of this would be to always deduct ad hoc payments off your upcoming payment regardless of how you pay it.
I think the credit card simplicity is much better at preventing this sort of situation, but I’m assuming there’s no reason other than user error that could attributing to the snowball effect.
Credit creates extra bills, administration, and complexity. The flip side is that it lets you have things that you can’t afford. There are times where this is genuinely useful (mortgage for a house, loan for a car that gets you to work, unexpected bill for something essential, etc), but the vast majority of BNPL purchases don’t fall into these categories. The result, I think, is that regular use of credit/BNPL makes people less aware of their assets and liabilities, less able to judge affordability of purchases, and less in control of their finances.
The more someone needs credit, the more important it is for them to use it carefully. Casual BNPL is not a good thing.
No, we want the product to be able work for a range of use cases (and many of the recent and upcoming product changes have been with that in mind) however we do still want the product to have some positive friction to discourage unhealthy usage. We think the situations where spreading a £10 payment over more than 4 months would be considered “healthy” to be really rare so the £3 minimum is something we definitely want to keep.