Money Saving Expert Martin Lewis has issued a warning over a new payment option being offered to Deliveroo users for takeaway food.
The warning comes after customers noticed a new option at the checkout on the food delivery app. Users now have the choice of paying for their food via Klarna.
Klarna is a finance service that doesn't charge interest or implement late fees for delayed payments. The move was criticised, with many suggesting the app is encouraging shoppers to build up debt during a time of financial uncertainty, reports the Manchester Evening News.
Read More: Martin Lewis sends out money warning to couples who live together but are not married
Posting on Twitter, Martin said: "Dear @Deliveroo do you really need pump debt as a way to pay for takeaways? Buy Now Pay Later may seem innocuous but it is 1) Not yet regulated 2) Debt, even if done right its 0%. Borrowing should only be if NEEDED, for planned one off budgeted purchase, not a cheeky nandos."
Klarna has the ability to pass arrears on to debt collectors, potentially increasing financial stress on people who are unable to make the payments. Deliveroo customers will see Klarna as an additional payment option when they go to pay for their takeaway and will be presented with the three following options:
- Pay Now, to pay the full amount immediately
- Pay in 30, to pay the full amount within 30 days
- Pay in 3, to pay in three equal instalments over 60 days, with a minimum spend of £30
Consumer rights expert and Mirror columnist Martyn James said: "It's extraordinarily irresponsible to be encouraging people to take out credit for takeaways. Failure to repay a credit deal can have a huge impact on your finances if the debt collectors are summoned - and people should not be encouraged to borrow for essentials like food that can be obtained much cheaper by visiting a shop."
A Klarna spokesperson said: "People have been paying for food deliveries with credit cards and overdrafts for decades but they've been stung by rip-off fees and extortionate interest so it’s time consumers had the choice of a healthier alternative where they only ever pay the original cost of the purchase."
A Deliveroo spokesperson said: "Deliveroo offers choice to our customers, from neighbourhood eateries and your weekday lunch to a Saturday night celebration. Millions of people are already choosing Klarna and we're giving customers more choice and more flexibility with a safe, secure way to pay online."
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