Let Me Think: Facilitating Deliberation in a Frictionless Economy

“Frictionless financing” platforms promise consumers a simple, seamless, and instantaneous financing experience that allows them to finance any number of products through their preferred retailer. For many consumers, frictionless financing is a welcome development that eliminates irritating design barriers that hamper consumers’ ability and desire to obtain financing at the point of sale. However, frictionless financing steers other consumers towards expensive, riskier, and more complicated borrowing options. It encourages them to make hasty financing decisions with limited information, exacerbating well-established consumer heuristics and biases.

To date, there has been little scholarly evaluation of whether frictionless financing truly benefits consumers in light of these competing vices and virtues. This Article fills that gap and questions whether faster, simpler, and more seamless is better. Frictionless financing often comes with costs to consumer financial health, including eliminating important points of deliberation and making high-cost, non-traditional financing dangerously and deceptively attractive. This Article suggests that by reintroducing friction and other consumer protections that encourage deliberation, consumers may be better able to understand their preferred financing products—and better protected even when they do not. So, this Article proposes regulations that reintroduce friction into the point-of-sale financing ecosystem by targeting thirdparty financing brokers. While this Article focuses on frictionless financing, it also offers potential regulatory principles for consumer protection and the frictionless economy beyond these products.