Looking stylish, trendy for Raya but drowning in debt

Economist warns that ‘buy now, pay later’ schemes and social media pressure are driving Gen Z into debt for Raya fashion, threatening long-term financial health.

PETALING JAYA: That old Malay saying, biar papa asal bergaya (living in poverty just to look stylish) is more than a proverb for some Gen Z this Raya, as social pressure drives them to spend beyond their means even using buy now, pay later (BNPL) facilities, just to look fashionable.

Universiti Teknologi Mara economist Dr Mohamad Idham Md Razak said young consumers may perceive purchases as more affordable because payments are fragmented into smaller instalments, encouraging them to spend more on clothing, gadgets and lifestyle items beyond their immediate financial capacity.

He warned that appearance-driven spending financed through short-term credit can carry longer-term consequences if not managed carefully.

“While a single purchase may appear manageable, repeated use across multiple platforms can accumulate into repayment pressure, reducing future savings and increasing vulnerability to unexpected financial shocks among Gen Z consumers.

“The growing use of BNPL facilities tends to smooth short-term cash flow but also lowers the psychological barrier to spending, especially during festive seasons such as Hari Raya.”

Mohamad Idham also highlighted that social media heavily influences spending during festive periods, as constant exposure to curated lifestyles, festive outfit trends and influencer marketing fuels social comparison.

He added that this can push spending from fulfilling actual needs to buying for identity and image, reinforcing overconsumerism during peak festive seasons.

“From a macroeconomic perspective, excessive consumption without corresponding income growth can weaken household balance sheets.

“When spending rises faster than savings, household debt levels tend to increase, limiting long-term financial resilience and reducing the ability of families to cope with rising living costs or economic downturns.”

Mohamad Idham highlighted that Gen Z spending patterns are generally more digital, trend-responsive and credit-enabled compared with older generations.

“Older households traditionally planned festive expenses through gradual savings whereas younger consumers are more comfortable relying on flexible payment tools, online promotions, and instant purchasing channels.”

Mohamad Idham said while festive spending boosts the economy by supporting retail businesses, SMEs and domestic demand, long-term growth depends on consumers having healthy income levels and good savings habits.

He said the key is promoting responsible spending that boosts the economy without causing household financial stress, supported by financial literacy programmes that teach practical budgeting skills rather than abstract theory.

“Campaigns that promote festive sinking funds, transparent understanding of BNPL obligations, and digital financial tracking tools can help Gen Z celebrate meaningfully while maintaining financial discipline,” he said, adding that education delivered through social media platforms may be particularly effective for this demographic.

Mohamad Idham also highlighted that high festive fashion prices, such as premium baju kurung costing several hundred ringgit, can amplify social pressure to spend.

He added that when fashion becomes linked to social status during celebrations, it can push young consumers towards instalment purchases or impulse buying.

“At the same time, it reflects how branding and exclusivity shape demand, underscoring the need for financial awareness so purchases stay within personal means rather than being driven by social pressure,” he said.

Previously, a study cited in parliamentary disclosures found that over 70% of active BNPL users in Malaysia are from the lower-income B40 group, with youth accounting for around 40% of transactions, mostly for everyday expenses.

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