Editorial written by Chicago Tribune Editorial Board.
A growing number of Americans are using “buy now, pay later” loans to pay for groceries. They’re borrowing money to buy milk.
Of BNPL users, 25% say they’ve used the loans for groceries, up from 14% a year ago, according to a LendingTree survey.
More stores and services are offering the option to cover purchases via BNPL, including Walmart and Instacart. Also, companies such as Sezzle offer an app that provides funds to shop for groceries.
BNPL services advertise themselves as interest-free, short-term alternatives to credit cards. But if a user misses a payment or stretches out the loan, the costs escalate quickly. Sezzle, for example, offers four interest-free payments — but also charges interest rates up to 34.99% APR for extended plans, rivaling subprime credit cards.
LendingTree found that more than 40% of the people using this kind of loan say they paid late on one of them in the past year, while 34% said so a year ago.
That so many people are turning to these short-term, high-interest loans just to afford groceries is a sign of deepening economic strain amid persistent inflation. And with more people today saying they’re making late payments, the concern becomes more serious. BNPL users are typically lower-income and credit-constrained.
That kind of borrowing isn’t about convenience — it’s a sign of desperation. And it raises a serious question: How did we get here?
The struggle to afford basic necessities like groceries didn’t begin with the Trump administration — as our readers know, inflation and a high cost of living was one of the main drivers that catapulted Trump back into office. For decades, both parties have overseen a slow erosion of the economic foundation that once allowed working-class Americans to get ahead. Wages have stagnated while housing, child care and food costs have climbed. And tax policy has become increasingly reliant on consumption taxes that disproportionately hurt low-income households. The result? Millions of Americans are now one grocery bill away from financial strain.
This kind of financial behavior shows desperation and risk, and policymakers need to acknowledge this trend and respond accordingly — namely, by embracing policies that lessen the cost of living, especially when it comes to the essentials.
We applauded the state’s decision to end its grocery tax last year, with one caveat — we were concerned that the legislation to do so opened the door to the implementation of local grocery taxes across the state, as municipal officials stared down the prospect of significant lost revenue. Those fears are becoming reality. More than 160 Illinois municipalities have adopted local grocery taxes, according to Tribune reporting, set to kick in when the statewide grocery tax ends in 2026.
Though perhaps understandable, these regrettable local taxes on groceries will only deepen the burden on struggling families if inflation and wage stagnation persist into 2026.
No one should need a loan to buy bread. This board calls on officials at all levels to remember the quotidian struggles regular people are facing right now — and to work together to ease the pain.
