Roughly 42% of Americans report using the apps at least once, according to a Credit Karma survey from February. But regulators in Europe and Australia, where many of the companies first launched, are increasingly concerned the apps are extending credit irresponsibly. And despite claims that users’ credit ratings won’t be affected and that there are no hidden fees, experts say consumers can still face late charges, overdraft fees and debt collection. Some apps, such as Quadpay, charge a $1 transaction fee on every payment made, regardless of the amount. Services boast that users’ activity and debt are not regularly reported to major credit bureaus.

Source: Los Angeles Times August 11, 2021 12:00 UTC