The buy now, pay later credit is a new way of financing that has become increasingly popular.
This article will explore the concept of buy now, pay later credit and what it entails.
There are many reasons why people choose to use the buy now, pay later credit as a form of financing.
For one thing, it allows you to purchase items without worrying about paying for them in full at the time of purchase.
It can be a great way to get items that you might not otherwise be able to afford at the moment.
It also allows you to make purchases without any debt hanging over your head.
Finally, it can be helpful for those who have bad credit and want alternative financing or those who don’t want any obligation in their lives.
What is buy now pay later?
The Buy Now Pay Later Credit financial product is for consumers who need to purchase goods or services now.
But, the consumer cannot meet the cash payment or prefer not to pay anything upfront.
“Buy now pay later schemes do what they say – you get the opportunity to buy something without having to pay for it until a later date. Also known as point of sale credit, some schemes give you 30 days to pay while others allow you up to 12 months.”Experian UK
Why Buy Now Pay Later Credit?
Buying now and paying later is a popular way of shopping.
Some stores or online shops provide this type of credit.
It allows customers to buy items without paying the total price in cash at the time of purchase.
Instead, they make a payment towards their investment over time, typically with interest charges added on.
This type of credit can be an attractive option for people who want to spend money but don’t have cash available.
It’s also a good choice for people who avoid using their credit cards or borrowing money to finance purchases they can’t afford immediately.
The Basics of Pay Later Credit Service
Buy now, pay later credit is a type of financing that allows consumers to purchase goods or services without paying for them in full at the time of purchase.
Instead, they make monthly payments over a set period.
Retailers and online stores often offer this type of financing as an alternative to traditional credit cards.
You can use it for furniture, electronics, and clothing purchases.
Two types of buy now, pay later credit are:
a) deferred interest
b) interest-free financing
Deferred interest means the consumer pays the total price for the item upfront but pays no interest on it until paid in full.
Interest-free financing means that there is no interest charged on the item financing.
How Buy Now, Pay Later Works:
Using a Buy Now, Pay Later (BNPL) option to spread out payments on a big buy resembles a personal loan in that your payments are split up into equal installments over time, typically just a few months.These loans are often interest-free as long you make your payments on time and in full.”Forbes
How to Save Money with a Buy Now, Pay Later Scheme
There are many ways to save money, but one of the most popular is the buy now and pay later scheme.
It is a way of buying goods or services without paying them all upfront. Remember, you could choose the zero-interest buy now pay later (BNPL) option.
What Kinds of Deals are Available for those on a Pay-Later Scheme?
Pay-later schemes are becoming increasingly popular among the population.
It allows people to buy expensive items without having to pay for them at the time of purchase.
The best deals available for those on a buy now pay later scheme are zero interest rates, no credit check, and no hidden fees.
Online retailers usually offer these deals, making it possible to buy products without worrying about high-interest rates or other charges.
Examples of BNPPL Service Providers
In today’s world, there are many ways to pay for purchases.
One of the most popular is deferred billing. It means that a customer pays for their purchase in installments and can choose to pay them off at any time.
It is a great way to buy something without paying the total price upfront and risk not being able to afford it later.
Deferred billing companies offer installment credit, an easy way to pay for goods or services over time.
They work with retailers, manufacturers, and other businesses selling goods or providing installment services.
They allow customers to make payments over a set period, usually six months or more, while they can still enjoy the product they purchased.
There are two BNPLs in Kenya in 2022:
a) Lipa Later
Lipa Later is a Kenyan tech-led consumer BNPL credit platform that provides short-term financing to consumers. No cash payment upfront shopping.
You pay interest for the consumer credit offered to you.
b) Faraja from Safaricom
Faraja offers a zero-interest credit service. You buy goods and services in Kenyan retail outlets without cash and repay within a month.
Conclusion: Why You Need Pay later Credit Service
Buy now pay later schemes to benefit those who want to buy a product instantly but are short of cash.
But it would be best if you used them with caution.
Some come with a monthly fee added to the principal amount, while others are zero-interest credit services.
The interest rate is higher than what you find on a credit card but lower than a personal loan.
You can borrow up to $10,000 and pay back the total amount over 12-24 months in the USA.
Some companies offer repayment holidays, and some don’t have any fees.
The APR for these loans can be as high as 39%.
Steve Wanjie is a digital marketing specialist, SEO Expert, expert article writer, blogger, sex educationist, and businessman. He is the founder of Dijito Marketing and Laikipo.com. He works and lives in Nairobi Kenya.