Walmart Ends Layaway Program Before 2021 Holiday Season, New ‘Buy Now, Pay Later’ Model Rolls Out
The program was created to allow people to put items on hold and make payments without any kind of associated fees.
In a statement, the company said:
“We have learned a lot over the past year as the needs and buying habits of our customers have changed. This past holiday season, we removed seasonal layaways from most of our stores with the exception of some jewelry items in some stores, and based on what we learned, we are confident that our options are payment offer the right solutions to our customers. “
University of Houston President of Human Development and Consumer Sciences Barbara Stewart said the layaway has been on the way out for some time. She said it costs retailers money.
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“For a retailer, the product is not available in inventory to be sold,” said Stewart. “Sometimes the customer doesn’t follow through, and as a result, you may have an off-season item that remains the property of the retailer, but they can’t fully recoup their loss.”
As an alternative, Walmart offers customers to structure a payment plan with Affirm.
Affirm is touted as a “buy now, pay later” model at no cost. Customers will need to qualify to use it.
“For some consumers, this buy now, pay later option works well,” said Stewart. “For others, the challenge is a path to financial disaster by buying more than you can really afford on your budget.”
Unlike Walmart’s layaway program, Affirm charges 10-30% interest, but customers get the items immediately.
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“Consumers need to realize that if you buy a small item, a small electronic device and pay for it over 12 months, will you still use it? Said Stewart. “Will you still have the service of this property in 12 months?” “
Sears and Burlington Coat Factory still carry layaway products.
For more on what to expect this holiday season, follow Mycah Hatfield on Facebook, Twitter and Instagram.
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