Martin Lewis has warned of an "explosion" of buy-now, pay-later firms that are "targeting under-30s".
The consumer expert said the government must take action over concerns they are getting many people into debt.
Speaking to the House of Commons select committee, Lewis said that regulation is urgently needed against payment providers that allow you to buy items on credit and pay for them later.
"It is absolutely the fastest-growing form of credit and it is targeted at the under-30s. And if you forgive me, most policymakers are not under 30 and it has gone under the radar."
Firms like Klarna - the world's biggest buy-now, pay-later provider - allow shoppers to buy items without paying up front, often without interest or charges.
They also offer a 'try-now, pay-later' service that allows the customer to buy items and return unwanted ones without paying the full bill.
The incredibly attractive shopping model means customers can spend without the hassle of having the cash in their bank account.
And it's working.
Klarna alone has almost 10million customers in the UK and is opening 95,000 accounts a week. Globally it has 85million customers and was recently valued at around £8bn.
"Advertising is done by influencers on Instagram, where they are pushing the feelgood hashtag Klarna. That is fundamentally inappropriate for a credit product," said Lewis.
The consumer expert warned regulation could be "too late" with millions of shoppers already registered on the platforms.
"My issue is that, just like with payday loans, it will be too late. It is unregulated, without controls both in product design and communications. When people have a problem – and often it actually works pretty well – there is no ombudsman you can go to, because it is unregulated. I would call for maximum speed to move this into the regulatory environment."
But Klarna dismissed suggestions that it is targeting vulnerable young adults.
"Regarding targeting under-30s, this is inaccurate," a spokesman said.
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"Klarna is aimed at anyone who values convenience and who wishes to spread the cost of purchases, without incurring any fees. The average age of a Klarna customer is 33 and our fastest-growing demographic is Gen X – those aged between 40 and 54."
The company said Klarna is a fully licensed bank, but that "this is not true of everyone in this sector".
Other providers in the UK include ClearPay and LayBuy, which also allow shoppers to buy and pay later.
Klarna, founded in Stockholm in 2005, said it fully supports "appropriate regulation" and that it has been engaging with the Financial Conduct Authority on the topic.
What happens to your buy-now, pay-later debt if a shop goes bust?
Arcadia, one of the biggest promoters of buy-now, pay-later firms, went into administration earlier this month, raising questions about buy-now, pay-later debts - especially for those with outstanding orders.
Martyn James of consumer website Resolver.co.uk says it's a "complicated" situation.
"Technically, your contract is with the firm providing the credit. This is a whole new area of retail and bankruptcy so what happens next remains to be seen. But here’s what should happen.
"If you’re using 'try before you buy' credit where you have 14 or 28 days to try the goods before returning or buying, contact the retailer straight away to tell them your intentions. Then speak to the BNPL firm to confirm that you’re returning or keeping the item(s). Ask them for their guidance on returning the goods," he said.
"If you’re paying in instalments but aren't paying interest, contact the BNPL firm to find out what happens next.
"Technically, you’ve got the goods and your commitment to pay for them remains so things should carry on as normal. The debt won't wipe out with the retailer, I’m afraid.
"If you have a credit agreement that charges interest then you should continue with your payments as normal and speak to the BNPL firm if you have any questions about the agreement."