VANCOUVER -- Many Canadians have faced financial difficulties during the pandemic, and that’s had some trying out new ways to pay for the things they need – like buy now, pay later services. But there are some things to look out for if you decide to use one. 

If you’re looking to buy a big-ticket item like a couch or a new computer online, maybe splitting the payments into instalments makes sense for your budget. That’s what buy now, pay later services like Afterpay, PayBright, Sezzle, Affirm and Klarna do. 

It seemed like a good option for Nicole Alleyne, who needed a new laptop for work last fall because she didn’t want to pay the whole cost up front.

“$1,300 up front when things have been tough this year was a lot of money,” she told McLaughlin On Your Side.

So at checkout, she chose PayBright when she made the purchase in November. It came out to about $70 a month for two years, with around $100 in interest tacked on.

That may be an easier price tag to stomach, but Keith Emery, co-CEO of Credit Canada Debt Solutions, says it’s still full price.

“You’re finding a way of tricking your brain into making a purchase that you otherwise wouldn’t make,” he says. “If you don’t have the money now, why do you think you’re going to have it in a couple weeks’ time?”

And there’s always the chance something could go wrong, like it did for Alleyne - Canada Post lost her package. And while requesting a refund with the retailer was simple, she says, getting the payment that had already come out of her account back from PayBright proved to be more difficult.

“I thought maybe that I was the only one experiencing this issue,” she says. “But just one look at their social media – I wish I had checked beforehand because there’s people that are out a lot more money than I am.”

Karla Laird with the Lower Mainland Better Business Bureau says communicating with your customers when things go wrong is crucial to keeping them happy.

“If you’re not communicating with consumers, they’re left in a space where they’ve spent their money and they’re now without any information as to what is happening, and that (creates) the discomfort or the discontentment on their side.”

When we reached out to PayBright about the refund complaints, a spokesperson said the company had seen a “significant surge in customer outreach since the holiday season which has meant a moderate delay in resolving inbound requests.”

Buy now, pay later services are beginning to gain popularity in North America, but when McLaughlin On Your Side asked CTV viewers in a Twitter poll if they’d tried one, more than 80 per cent said they hadn’t and didn’t ever plan to.

About 13 per cent said they would give it a try, and only six per cent said they’d used one and liked it.

That doesn’t surprise Emery.

“For a lot of consumers, it’s questionable whether adding that complexity to your budget is worth it,” he says. “As someone who is a credit counsellor and really interested in helping people develop healthy budgeting skills, it’s not a good approach.”

Consumer Reports suggests that if you are planning on using one of the services, there are a few things you should look out for.

While some buy now, pay later services offer interest-free loans, others can charge as much as 30 per cent and apply penalties when you miss a payment. You need to keep track of your payments, something that can get more complicated if you have multiple items you’re paying off at the same time, on different schedules.

Because of the deferred spending, many consumers can be tempted to spend more, and because you’re dealing with both the retailer and a third-party lender, returns and refunds can be tricky.

Alleyne says it took a month for her complaint to be resolved.

“After I threatened to talk to CTV News, I got my money back,” she says.

With files from Consumer Reports