This segment was originally going to be about self-employment taxes, though now it’s a new breaking news alert on an interesting (if concerning) DoorDash development. It’s about the recent business deal between “Buy Now, Pay Later”, AI-powered service, Klarna, with DoorDash. The intention is to allow more food payment flexibility to economically suffering Americans. And while that might sound like a noble venture, it’s also brought on a lot of deep thinking on social media (yes, really!) about what this portends in the way of adding on to personal debt.

I’m going to dive into this and see what it means for DoorDash customers—though, most importantly, how it affects you, the deliverer.

Based on the recent press release on this deal, both Klarna and DoorDash seem excited at the potential customer convenience. On the DoorDash end, they want people to buy more than just food, with electronics and other spendier things now in the delivery mix. For Klarna, it’s the usual corporate giddiness of being able to partner with a major business partner to up their clout.

Klarna is far from the only “Buy Now, Pay Later” service available. Over the last 5 years, many of these companies have popped up worldwide, with the most familiar to you likely being Affirm, or Apple’s Pay Later. Nearly all let you set up “Pay in 4” installments, some with interest and others not.

I admit to using Affirm a few times, though not for food. It was strictly for more expensive items, like electronics or household products. With Klarna generally ranked third for the most familiar BNPL services, it appears they’re one of the first to venture into allowing later payments for basic food deliveries.

One thing we all know about these companies is that they’re no doubt already being abused. Some people can’t resist putting in a promise to pay later, then renege because they have other expenses to pay, or just don’t have the money.

Let’s look at what that might mean in the way of “food debt” becoming a new depressing issue in America.

Will Americans Abuse the Klarna/DoorDash System?

In a word: Probably. You’ll find those who think these BNPL systems are just loan sharks who let people get into further debt trouble. It’s hard not to argue this stance in a time when economic hardship is at a new high. The divide between being rich and poor is more distinct now than ever, and many don’t even have enough money to buy decent amounts of food.

The idea you can order something from Jack In The Box and pay for it later in the month is far too irresistible. But what happens when someone decides to take risk and just never pays the bill? There may be more people who do that than anyone knows when many want faster fast food fixes.

Not only do fast food restaurants lose money this way, it also hurts DoorDash’s reputation. Plus, you have another little thing that should be the main focus: How does it affect the deliverer financially?

I’d say Klarna should have a provision of taking money out of the customer’s bank account if the bill isn’t paid before the end of the month. Some payday services do this if the loan isn’t paid on the initial due date. All of them also typically take legal action by garnishing paychecks.

The social media world also thinks food debt will become a major new problem in our United States of America. Sure, it sounds improbable, yet lack of any major penalties from Klarna could let the public abuse the system without too much worry. With many already deep in other debt, they may figure food debt is the least of their problems. 

As someone who delivered for DoorDash, I also take aim at what this does in deliverers being properly compensated. There hasn’t been any true clarification on what might happen if customers don’t pay their bill right away. It’s worth a quick look at what this means in terms of base pay—plus tips drivers depend on.

Will DoorDash Deliverers Still Be Paid On Time?

One thing about DoorDash is, with every prior customer being forced to pay in the moment, tips often helped drivers make well over $100 in a day. Once I was at Platinum status, I’d always make at least $100, and usually $120-$130 if delivering six or seven hours. Most of that was based more on tips than just the base pay.

DoorDash doesn’t even mention the drivers in their new press release about the Klarna deal. They just focus it on the customer, which is what they’ve always done anyway. I’d fully expect them to say all deliverers will still be paid the same as they have. The fact that they haven’t makes me wonder if changes are ahead.

Not being paid right away is one of the worst feelings in the world for those who’ve done freelancing work. When I worked as a freelance writer for 15 years, any delayed payment was a big problem. Even though it didn’t happen a lot with me, there were a few times when payments were moved to a week ahead, creating predicaments on getting bills paid on time.

The greatest thing I discovered about DoorDash was the chance to get paid nearly instantly via card transfers. If you had a DasherDirect debit card, all money you made in a day when on that, allowing you to cash in immediately. It was only if you waited for the automatic payment system to pay into a bank account when you had to wait until the upcoming week. Transferring to the DasherDirect card meant a small fee, despite being minuscule. This was worth it just to have the money faster.

With many DoorDash customers no doubt paying later now via Klarna, will deliverers have to wait to get their payments until later in the week or beyond? It’s a valid question to ask considering anyone having to use Klarna is assumed to not have any money…right away. Maybe some have no money at all. 

Yes, this means the immediate tips deliverers enjoyed might not happen right away either. How can a customer leave a tip if they haven’t even paid for their food? The base pay for the order would have to be delayed as well since that’s the approximate amount of the order itself.

Unless DoorDash pays the deliverers ahead of time based on what they think the customer is going to do, it may mean delayed payment systems. It would truly turn into freelancing work where payments are just a gamble or guessing game. And that would make DoorDash far less appealing to do for anyone thinking it over.

In a changing world now where getting paid what you’re worth is becoming far less possible, delayed payments at DoorDash would certainly ruin it for me. I’ve taken a break from it in recent months, though would think twice about returning to it if drivers have to wait to be compensated for a full day’s work.

Unfortunately, some may be so desperate to make money, they’ll willingly go along with this if there’s a guarantee of payment within two weeks or more. Unless you have a solid job where you’re paid weekly (as I fortunately do), some people may have to deal with shit just to have the convenience/freedom of Dashing.

This is a mere vent based on what’s out there right now. I’ll do a follow-up if I see evidence to any DoorDash deliverer pay changes. As of this publication, however, I’m expecting something different to payments is going to happen based on customers no doubt being all over the Klarna method.

It just seems unlikely DoorDash would pay the deliverer the same as before if a customer hasn’t paid for their food in full. Corporations would never take such a risk without losing money themselves. 

Now, maybe Klarna employed some mob-like figures who’ll knock down the doors of those who don’t pay their food bills. DoorDash should do the same to at least ensure a payment within a week. After all, they do have phone agents who sound like CIA agents. Hearing that on the phone is intimidating enough, believe me.

I’ll plan to cover this topic numerous times based on info I gather, and/or my own experiences if Dashing again soon.

Part XXXIII will now revert back to the self-employment taxes issue originally intended for this space.

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