You are absolutely right about the flawed logic of consumers and...

You are absolutely right about the flawed logic of consumers and the greater use of BNPL for non discretionary spending but unfortunately Zip only takes a clip of the interchange fees at non integrated merchants ( About 20 basis points ) and from this they have to fund interest expense and bad debt which means on current metrics the cash transaction margins are negative even before the annualised $300 million of Opex is deducted.

Consumers do not have unlimited budgets and by the time they service the ever increasing costs of mortgage/rent , energy ,fuel car finance etc there is nothing left. They might put it on BNPL because they don't have the full amount this week at point of purchase but they won't have it in two weeks or four weeks time either so people will use Zip for essentials but are more and more unlikely to pay it back.

i think you will see several BNPL going bust owing money to merchants and the whole house of cards will collapse