Gen Z moving away from traditional revolving cards

Younger borrowers – particularly Gen Z – are increasingly skeptical of traditional credit cards. Why? Because minimum payments let balances and interest compound indefinitely .

The Alternative Model

Products like Afterpay attract customers who want to:

• Settle balances at the end of the period
• Have clear visibility into what they owe
• Avoid compounding interest 

Why This Matters

The shift away from revolving credit is significant. If younger borrowers reject traditional credit cards, the entire lending industry may need to adapt. This could mean more "pay-in-full" products and less revolving debt.

What You Can Learn

• Interest that compounds is dangerous. Avoid products that let balances roll over month after month.
• Short-term installment products (like Pay in 4) are easier to manage because you know exactly what you owe and when.
• Do not assume a credit card is your only option. Explore alternatives.