The Top Buy Now, Pay Later Apps for 2024
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“Buy now, pay later” is a type of payment plan that can be used at most retailers to divide the cost of your purchase into a series of smaller, equal installments.
Known as BNPL for short, these plans often come with no interest and minimal fees. You can use them to shop online or in stores, depending on the app.
Here are six of the top BNPL apps, plus alternatives to consider.
Affirm
Affirm offers a wide range of BNPL plans to choose from, including a pay-in-four plan and monthly payment plans. It charges zero fees.
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How to get approved for Affirm
Affirm performs a soft credit check, which doesn’t hurt your credit. It may also consider prior payment history with Affirm, how long you’ve had an Affirm account, any outstanding Affirm loans, your credit utilization, current debts and income, and any bankruptcies.
» READ: NerdWallet’s Affirm review
Afterpay
Afterpay offers pay-in-four and monthly payment plans. If you pay on time, there are no fees for using Afterpay. If you miss a payment, it charges a late fee up to $8.
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How to get approved for Afterpay
Afterpay performs a soft credit check, which doesn’t hurt your credit score. As part of its approval process, Afterpay may also consider whether there are sufficient funds on your debit or credit card, how long you’ve been using Afterpay, the purchase price and whether you have other outstanding loans with Afterpay.
» READ: NerdWallet’s Afterpay review
Klarna
Klarna offers a pay-in-four plan, a pay-in-30 plan and monthly financing. It charges a late fee for missed payments and an undisclosed service fee if you use a one-time virtual card at a store that doesn’t partner with Klarna. It may also charge a payment rescheduling fee.
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How to get approved for Klarna
Klarna conducts a soft credit check, so it will take into account your credit score and credit history when making an approval decision. It also looks favorably on applicants who make on-time payments to Klarna.
» READ: NerdWallet’s Klarna review
PayPal
PayPal offers a pay-in-four plan and monthly financing that’s available for online purchases. PayPal doesn’t charge fees.
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How to get approved for PayPal
PayPal conducts a soft credit check. Approval is based on a few factors, like your account history with PayPal and information provided by the credit bureaus.
Sezzle
Sezzle offers a pay-in-four plan, a pay-in-two plan and monthly financing. Sezzle charges numerous fees: a late fee if you miss a payment, a convenience fee for paying by debit or credit card (after your first installment), a rescheduling fee if you change a payment date more than once per order and a failed payment fee if Sezzle can’t acquire payment.
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How to get approved for Sezzle
Sezzle conducts a soft credit check, which will not affect your credit score. It will consider any prior history with Sezzle when determining your spending limit, as well as information from the soft credit check.
» READ: NerdWallet’s Sezzle review
Zip
Zip’s pay-in-four plan is available anywhere Visa is accepted. Zip charges an installment fee for using its pay-in-four plan, a late fee if you miss a payment and a rescheduling fee if you reschedule a payment more than once per calendar month.
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How to get approved for Zip
Zip performs a soft credit check. Beyond that, the company doesn't publicly share how it approves customers, though it says it takes into account numerous factors.
» READ: NerdWallet’s Zip review
Compare buy now, pay later apps
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Should you use a buy now, pay later app?
NerdWallet recommends paying for nonessential purchases with cash whenever possible. Though BNPL may seem like a convenient payment option, it’s still a form of debt.
Consider these pros and cons when deciding whether to apply for a pay-later offer.
Pros
No interest financing: Most BNPL apps charge zero interest for their pay-in-four loans. That means if you make all payments on time, you use the service for free. It’s rare to be able to finance a purchase, especially a bigger ticket item like a computer, at zero interest.
No hard credit check: Unlike applying for a credit card or loan, BNPL apps won’t usually conduct a hard credit pull, which can temporarily lower your score. Also, if you’re worried about a low credit score, you may have an easier time getting approved by a BNPL app than a traditional lender.
Simple, convenient and fast financing option: BNPL apps pride themselves on the simplicity and ease of their payment plans. Often integrated directly into the checkout process, applications are short and approval decisions are instantaneous, so you can opt into a BNPL payment plan within minutes.
Cons
Could encourage overspending: BNPL plans can make it feel like you’re spending less than you are. For example, if your budget for a purchase is $100 and you opt into a pay-in-four plan, you’ll only pay $25 upfront. For some shoppers, it may be tempting to go back and fill up their cart with more items.
Likely won’t be able to build credit: Most BNPL companies don't regularly report on-time payments to the three main credit bureaus, so you won’t be able to build credit by using these plans. However, they may send past-due accounts to collections, which can hurt your credit score.
Fees: Though some BNPL apps won’t charge any fees, many do — especially if you miss a payment. Fees can range from $2 to $15, represent a significant percentage of the total and increase the cost of your purchase.
Customer service issues: Some BNPL users may have trouble settling disputes. For example, if you buy an item you need to return, you must deal directly with the store, even though your loan is through the BNPL lender. This can delay your refund.
Did you know?
On May 22, 2024, the Consumer Financial Protection Bureau issued an interpretive rule stating that BNPL lenders are considered credit card providers . This gives shoppers additional protections, including the right to receive a refund after making a return and the right to dispute charges.
How to get a BNPL app
If you want to shop with BNPL, there are two main ways to access these payment plans.
Download the provider’s mobile app
You can download a BNPL mobile app to your phone from either the Apple or Google Play app stores. Once you have the app, you’ll create an account, and you may receive an initial spending limit, often known as “purchasing power” or “spending power.” You can shop online directly from the app, or if you want to shop in-store, you can create a one-time virtual card which you can save to your phone’s mobile wallet and scan at the register.
Shop online at a partner store
Some stores offer BNPL payment plans during online checkout. When you go to pay, you’ll see an option to divide your purchase into smaller installments with a BNPL provider like Affirm or Afterpay. You’ll need to log into your account or create an account by filling out a short application. You’ll receive an instant approval decision.
Alternatives to buy now, pay later
Though buy now, pay later can provide a simple and convenient way to cover a purchase, it doesn’t offer the same perks as other financing methods. You may want to consider these alternatives.
0% interest credit card: If you have good or excellent credit (a credit score of 690 or above), you could qualify for a 0% APR credit card, which charges zero interest during the card’s introductory period — usually 15 to 21 months. Credit card companies will report payments to the bureaus, which may help build your credit. You may also receive a sign-up bonus or access to a rewards program.
Small personal loan: If you want a longer repayment period, a small personal loan could be a smart choice. Loans are available for borrowers across the credit spectrum, and like credit cards, you can show a history of on-time payments to the bureaus. You’ll pay interest on a personal loan, but with longer terms, the monthly payment may fit more comfortably in your budget.
on NerdWallet
