Psychological Mechanisms and Debt Risk in Buy Now, Pay Later Use: Evidence from University Students in Vietnam

Abstract

This study investigates the psychological and behavioral mechanisms underlying the use of Buy Now, Pay Later (BNPL) services among university students, a population increasingly exposed to digital credit options yet vulnerable to financial mismanagement. The research aims to examine how external BNPL-related stimuli—subjective norms, marketing campaigns, and perceived convenience—shape students’ internal psychological states, including Fear of Missing Out (FoMO), attitudes toward BNPL, and spending control, and how these factors subsequently influence impulsive purchasing behavior and debt risk. A quantitative approach was employed, using an online survey administered to undergraduate students with prior BNPL experience. Data were analyzed through Partial Least Squares Structural Equation Modeling to assess both measurement validity and structural relationships within the proposed Stimulus–Organism–Response framework. The findings reveal that social influence, promotional activities, and convenience significantly affect students’ FoMO and attitudes, while convenience negatively impacts spending control. FoMO and positive attitudes emerge as strong predictors of impulsive BNPL purchases, which, in turn, significantly elevate debt risk. Spending control plays a protective role by reducing the likelihood of financial overextension, whereas financial literacy moderates several key relationships, helping to weaken emotional and cognitive drivers of risky BNPL usage. Overall, the study highlights the complex interplay between digital marketing environments, psychological factors, and financial behaviors among young consumers. The results contribute to a deeper understanding of BNPL-induced vulnerabilities and offer practical implications for policymakers, financial educators, and BNPL providers in promoting responsible digital credit use.