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DAILY NEWS ANALYSIS

  • 31 December, 2023

  • 2 Min Read

Buy Now Pay Later (BNPL)

Checkout portals of many e-commerce websites, mobile applications and even banks now offer an option of paying later.

  • BNPL is a short-term credit facility extended by banks directly or retailers (through their tie-ups with banks and NBFCs), that allow consumers to defer payment on their purchases for 15 to 365 days.
  • Depending on the service provider, the interest-free period may vary from 15-30 days, beyond which the customer can repay in a single shot or in EMIs spread over 1-12 months.

EMI stands for equated monthly instalment, which relates to payments made regularly to repay an outstanding loan within a certain period.

  • Unlike the paperwork for traditional loans, customers can enroll for this credit facility almost instantly using their mobile phones, by finishing basic e-KYC procedures.
  • In most cases, the e-KYC procedure does not involve a video authentication.
  • Hence, the RBI has mandated that the loans disbursed shall be term loans, for a maximum tenure of 12 months, capped at ?60,000 a year, unless the customer upgrades to full KYC.

OLA’s Postpaid, or Amazon’s Pay Later, or HDFC Bank’s Flexi Pay, are all examples of a now in vogue short-term financing facility called Buy Now Pay Later (BNPL).

  • BNPL also helps lenders explore new borrowers who would not ordinarily come to them for a loan.
  • Besides the digital only enrolment, BNPL also varies from a regular credit card purchase or a regular personal loan, on the low-ticket size and comparatively lower interest rate charged.
  • BNPL loans do not entail any processing fee or other on-boarding charges.
  • However, BNPL providers do levy additional charges such as late payment fee and pre-closure charges.

Source:


Competition Commission of India (CCI)

Competition Commission of India has selected Ansuman Pattnaik as the new head of its investigation’s unit recently. The Competition Commission of India (CCI) is a statutory body within the Ministry of Corporate Affairs. It was established in 2003, but became fully functional in 2009. The CCI aims to establish a

Connected Lending (CL)

RBI’s move to consolidate the scattered laws on connected lending is welcome. CL refers to persons who are in the position to control the decision of the lender. CL is the extension of credit to individuals or firms connected through ownership or the ability to exert control, whether direct or indirect. CL refers to cases where the

Cosmic Distances

No human probe has travelled much beyond the Solar System, yet we are able to measure distances across billions of light-years. The space beyond Earth is so incredibly vast that units of measure, which are convenient in everyday lives, can become gigantic. Distances between the planets, and especially between the stars, become so big when e

Devil Comet

Mount Everest-sized Devil comet hurtling in Earth’s direction could explode today. Pons-Brooks Comet - Comet 13P/Pons-Brooks, also called the Devil Comet, is about the size of Mount Everest and it is hurtling towards Earth. After an outburst in July, scientists believe that the comet could explode once again today. Ice volcanoe

Kakad Bhairav or Bhilat Baba BHILS

A stone deity worshipped by the Bhils in Madhya Pradesh’s Bagh was recently proved to be a fossilized dinosaur egg. Just like their ancestors worshipped ancient stones as deities, generations of Bhils had worshipped this sunbaked, reddish-brown Kakad Bhairav or Bhilat Baba. Sacrifices of chickens and sheep marked their whispered pleas

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