00:00How do you repo a burrito? Klarna, the buy now pay later app, is having to answer that question
00:05after losing $99 million in the first quarter of 2025. And the reason why is because people are
00:11just straight up not paying them back. Oops. You might have used afterpay, Klarna, or a firm to
00:16finance a vacation, concert tickets, or another large purchase. Instead of shelling out $500
00:21up front for those Lady Gaga concert tickets, you could pay $125 now and pay the rest in three easy
00:27installments over 6 to 18 months. Look, it's a tough economy out here and some people are using
00:32buy now pay later apps just to go to the grocery store or buy some fast food. With interest rates
00:37as high as 36%, those who don't repay on time may find themselves spending way more than they
00:41originally intended. If you're checking out at like Shein or Teemu, they might suggest that you pay
00:46with Klarna over four easy installments. So instead of spending $200, you only have to spend $50 today.
00:52Maybe you go and put more items in your cart, adding up to $800 total, and then check out and still only
00:56spend $200 today. And that leaves people with these huge unexpected bills that they now need
01:01to pay off. Or not. There's definitely a party at the end of the world type feeling on TikTok and
01:06X right now, with lots of people alluding to just never paying back their loans. It's indicative of
01:11a larger problem, which is that 60% of Americans are having trouble affording even the bare basic
01:16necessities right now. Boomers have layaway, Gen X had credit cards, and now millennials and zoomers
01:21have these BNPL services with low barriers of entry that'll let just about anyone borrow money. But the
01:26difference here is that 41% of buy now pay later users are paying back their loans late and accruing
01:31interest. And all jokes aside, even if Klarna does go out of business, you might still be on the hook
01:35for those outstanding debt. It could get sent to debt collectors, or it could impact your credit score.
01:40Some people simply have no choice but to live this way. And the mindset is, what are they going to do?
01:45Repo my burrito?
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