DIGITAL DEBT AS‘SELF-REWARD: RECONCILING GEN Z’S PAYLATER CONSUMPTION WITH ISLAMIC FINANCIAL ETHICH

Abstract

This study explores digital debt practices among Generation Z by framing paylater consumption as a form of self-reward in the digital economy and examining its compatibility with Islamic financial ethics. The ease of access, instant gratification, and lifestyle-oriented marketing of paylater services encourage Gen Z to normalize deferred payments as part of everyday consumption. While such mechanisms provide short-term satisfaction and perceived financial flexibility, they also pose ethical challenges related to debt accumulation, self-control, and moral responsibility. From the perspective of Islamic finance, consumption is expected to be guided by principles of balance (wasatiyyah), responsibility, and the avoidance of exploitative financial elements. This study employs a normative and conceptual analysis to assess whether paylater practices can be ethically justified when aligned with Islamic values. The analysis indicates that digital debt may be tolerated as a conditional financial instrument when it avoids usury, ensures transparency, and supports genuine needs rather than impulsive desires. Ultimately, the study emphasizes the importance of integrating Islamic financial ethics with digital consumer behavior to promote sustainable and morally grounded financial practices among Generation Z.