Behind the Numbers: The Science of Micro Lending and Financial Inclusion

1. High interest rates: When you buy furniture and appliances on credit, you typically have to pay a high interest rate on the amount you borrow. This means that you will end up paying much more for the items in the long run.

2. Debt accumulation: Buying furniture and appliances on credit can lead to accumulating debt, especially if you are not able to make the required payments on time. This can negatively impact your credit score and financial stability.

3. Impulse purchases: Buying furniture and appliances on credit can lead to impulse purchases, as it is easier to make a purchase when you don’t have to pay for it upfront. This can result in buying items that you do not actually need or cannot afford.

4. Limited options: When you buy furniture and appliances on credit, you may be limited in terms of the options available to you. Some stores may only offer financing options for certain items or brands, which may not be the best fit for your needs or budget.

5. Risk of repossession: If you are unable to make the required payments on your furniture or appliances, there is a risk that the items may be repossessed by the lender. This can result in losing the items and still being responsible for the remaining balance.