Pros and Cons of Buy Now Pay Later

Pros and Cons of Buy Now Pay Later
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Most of us have heard of or used “Buy Now, Pay Later” financing services. If you don’t know what they are or have never used them, you are in the right place to learn.

“Buy now, pay later” services are typically short-term payment plans that allow you to make a purchase “now” and pay for it “later” at a future date, typically interest-free. With the massive boom in online shopping, “buy now, pay later” plans have become increasingly popular.

Most plans require you to make a down payment, perhaps 20-25 per cent of the price; the remaining payment is made in installments. While some offer even more flexible terms where you do not make a down payment at all and directly start through installments.

Today, we will discuss some pros and cons of “buy now, pay later” to give you a better understanding of what you are getting into with such financing services and plans.

Pros and Cons of “Buy Now, Pay Later”

Before we start, remember that not all “buy now, pay later” payment plans are the same, and they may vary with service and vendor. Always read the terms carefully or consult a professional before applying for any financial services or plans.

That being said, let’s dive into the pros first.


Here are some excellent benefits or “pros” of “buy now, pay later” plans.

●        Convenient

“Buy now, pay later” makes it very easy to make bigger purchases because you can pay for them over time instead of breaking your bank at checkout. Expensive items like appliances, electronics, gadgets, and furniture are some of the most popular and suitable items for such payment plans.

●        Usually Zero-Interest or Lower Interest Than Credit Cards

Most “buy now, pay later” payment plans are offered with no interest or lower interest than credit cards, making them extremely attractive. However, as mentioned, with more online shopping platforms, low-interest “buy now, pay later” plans are quickly dying or turning into interest-free “buy now, pay later” plans.

●        Flexible Plans

Some “buy now, pay later” plans are quite flexible, offering you the choice of 6-month, 1-year, or 2-year payment plans. Others may charge you a small interest for longer-term plans. However, this trend is quickly dying, and most will not charge you any interest, but they may also not offer long-term plans.

●        Quick Approval Regardless of Credit Score

Thanks to online shopping, buying now and paying later is approved very quickly, often instantaneously at the checkout of online stores. Furthermore, these payment plans typically do not care about your good/bad credit score.


Here are some common “cons” of “buy now, pay later” plans.

●        May Encourage Impulse Spending

This is perhaps the biggest drawback of “buy now, pay later.” You get what you want before you’ve even made the first payment for it, tempting many to indulge in impulse shopping. In such cases, people buy things they don’t actually need and then regret when they have to pay for them over time.

●        Tracking Payments May Be Difficult

While many such plans automatically charge you at intervals, keeping track of all the payments may prove to be difficult, especially if you purchase many items or go for longer-term plans. Most vendors and service providers will not cheat you on payments, but you may want to check for hidden fees.

●        Hidden Fees

Quite often, “buy now, pay later” plans come with hidden fees. It could be a delivery charge, transaction fee, or service charge. You must always read the terms carefully and ask about hidden fees before opting for such financing services or plans.

●        Fees for Missing or Late Payments

Most “buy now, pay later” plans charge you a late payment fee or a missing payment fee if you fail to pay on time. Depending on the terms, this may be a small fee, or it could be a substantial one.

●        No Cash Back or Rewards

Since you are already getting an interest-free payment plan, most “buy now, pay later” plans remove any cashback or rewards you would otherwise get if you directly purchased the product.


There you have it; these were some key pros and cons of buy now pay later plans, and they should help you better understand such financing services. However, you should know that many online vendors trap people with hidden fees and confusing terms.

Still, some, like Gimmie, are completely honest and transparent about their terms and offer flexible plans with no hidden fees.

We highly recommend going through the terms before opting for “buy now, pay later” payment plans and making your purchases and financial decisions responsibly.

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