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Illustration: Charlotte Pollet for Bloomberg Businessweek

The Buy Now, Pay Later Juggernaut Is About to Be Tested

Economic uncertainty, competition, regulators, and the usual consumer debt problems are spoiling the fun.

For three days each week during the month of April in 2014, a seasoned product manager named Lulu Young, an engineering manager named Paul Connolly, and a 24-year-old jewelry salesman named Nick Molnar gathered in a bare, windowless conference room in Melbourne to hash out the features and functionality of a financial product that existed only in Molnar’s head. The goal was to appeal to two constituencies at once: online retailers, who were always eager to convert more virtual browsers into actual shoppers; and consumers, some of whom didn’t have credit cards but, Molnar thought, might still like a way to get their goods first and then pay for them over time.

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