Here's why consumers haven't yet used buy-now-pay-later for online transactions.

A Kredivo and Katadata Insight Center (KIC) survey reveals that approximately 60% of consumers have not used paylater payment methods for online transactions in the past year.

The main reason consumers haven't used paylater is to avoid increasing debt, accounting for 43%.

Furthermore, 35% expressed fear of overspending, while 30% worried about late payment penalties.

Additionally, 23% prefer standard online payment methods. Other reasons include lack of interest (19%), lack of understanding of paylater (18%), high installment interest (16%), and administrative fees (12%).

Other reasons cited include concerns about disrupted financial management (11%), data security (9%), religious beliefs (8%), concerns about credit score/BI checking impact (8%), and other reasons (2%).

Therefore, KIC and Kredivo urge paylater providers to increase consumer education to improve understanding of paylater as a digital payment option. This includes clarifying aspects such as annual fees and tenor lengths.

However, the survey also found that among consumers who haven't used paylater, about 70% plan to use it in the future. 16% intend to use it soon, and 22% plan to use paylater only when urgently needed.

The survey, titled "Indonesian E-commerce Consumer Behavior," utilized primary data from 16 million payment transaction samples from 1.5 million Kredivo users across Indonesia's five largest e-commerce platforms in 2021.