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Buy now pay later terms take almost an hour to read

Written by: Emma Lunn
The policy documents for buy now pay later (BNPL) provider Klarna take 57 minutes to read at average reading speed, according to NerdWallet.

The personal finance website analysed how long it takes to read the terms and conditions and privacy policies for popular BNPL apps.

It assumed the average reading rate for a native English speaker is 238 words per minute. It then used the number of words in each document to calculate the average time it takes to read the policy documents of 11 popular BNPL providers. It found that the typical document took an average of 36 minutes to read.

However, it’s also important to consider the clarity of these documents, which may lead to additional reading time. So, NerdWallet also rated BNPL terms and conditions for ‘clarity’, with providers scoring 60% on average.

Klarna’s policy documents took the longest to read, at 13,637 words and a clarity score of 48%. Zip’s terms and conditions were less than half as long at 4,917 words, taking 21 minutes to read, and scored 92% for clarity.

The lowest clarity score was Payl8r which scored just 39%. Its policy documents are 9,788 words long and take 41 minutes to read on average.

The risks of buy now pay later

John Ellmore, operations director at NerdWallet, said: “With the length and complexity of terms and privacy notices, we shouldn’t be surprised if many people click accept without reading or understanding exactly what they’ve agreed to. This may not cause problems for most people, but there is a risk that a customer could agree to something they weren’t aware of if the crucial piece of information was buried in a mass of text.

“Especially as buy now, pay later schemes grow in popularity, it’s important that providers try to make their terms and privacy policies more concise and easier to read. The fact that some providers, like Klarna, have double the number of words in their terms and privacy policies than other providers, shows that a lot more can be done to make these documents more readable and consumer-friendly. Improving the accessibility of the documents could encourage people to read them in full, helping them to better understand their rights and feel more confident about the service they are using.”

A study by Compare the Market found that BNPL purchases were up by a third during lockdown, with 35% of UK adults using BNPL schemes more than they did before the coronavirus outbreak.

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