Best Buy Now, Pay Later Apps of September 2021

When you’re ready to purchase a coat from Neiman Marcus or a new MacBook from Apple, you now have the option of financing the cost of your order over time with buy now, pay later. BNPL, also known as point-of-sale loans, is kind of like a modern day layaway option: Consumers can buy items online or in store, and then split up the cost of a purchase over a few weeks or a few months with regular installment payments rather than pay for the entire purchase up front.

There are many BNPL providers that have emerged in the past few years, and consumers are increasingly flocking to them to finance everything from clothing to travel to workout equipment. Some of the most popular BNPL providers include Affirm, Zip (formerly known as Quadpay), Afterpay and PayPal’s ‘Pay in 4’.

With so many BNPL options available to consumers, which provider is best? And for who? When compiling this round-up of popular BNPL options, Select looked at factors like APR, late fees, available merchants, whether a credit check is performed and if the provider reports to the credit bureaus to help you determine which provider is best for you. (See our methodology for more info on how we reviewed each POS loan.)

Who’s this for? Affirm is a good choice if you need a longer-term financing option with a 0% APR and no late fees. It offers POS loans ranging from 1 month to 48 months with a limit of $17,500 per loan. Affirm is one of the few BNPL providers that offers consumers long-term financing options with a 0% APR.

However, the interest rate that you manage to secure on your loan depends on a variety of factors — including purchase amount, length of payment term and the merchant — so you could end up with an APR as high as 30%.

If you manage to secure a 0% loan, you also don’t have to worry about late fees. Of the seven BNPL providers Select reviewed, Affirm was one of three providers that didn’t charge any late fees. Though if you’re late with payments, you might not able to get a loan from Affirm in the future, and it could potentially affect your credit score.

Affirm uses a soft credit check when approving consumers for loans. It also reports some loans to the credit bureau Experian. It doesn’t report 0% four-biweekly payment loans or 0% loans with a three-month repayment period. Your payment history, how much credit you’ve used, late payments and how long you’ve had the credit line open can affect your credit score.

Affirm is a good choice because of its widespread availability: You can essentially use it on any purchase anywhere by using the Affirm website or the app.

Affirm has partnered with 12,000 merchants including Amazon, Peloton and Target. Through affirm.com or the Affirm app, consumers are also able to use the BNPL option at any retailer, either online or in-store, that aren’t integrated with the company. Consumers will receive a single-use virtual card through the website or the app to pay for their purchases wherever they want.

While the Better Business Bureau gives Affirm an A+ rating (you can read more about the BBB rating process here), customer reviews are not so good. It has a 1.23/5 average rating based on 235 customer reviews on the BBB website at the time of writing. The customer complaints range from not being able to get ahold of customer service to not being able to obtain a refund.

Who’s this for? Afterpay is an Australia-based company that was recently acquired by Square, a digital payment company co-founded by Twitter CEO Jack Dorsey, for $29 billion. Afterpay doesn’t consider itself a POS loan provider because it doesn’t charge interest on its loans, but it is commonly referred to as a BNPL provider so we’ve included them in this round-up.

Afterpay is best for people who can make their payments on time, need a short-term financing option with 0% interest and don’t want the loan to affect their credit score.

The company offers one product: a financing option with four installment payments due every two weeks over a six-week term. You make one down payment at the time of purchase (typically 25% of the order) and then pay the rest over six weeks.

There isn’t a limit on how much credit you can take out with Afterpay. Your credit limit depends on how long you’ve been an Afterpay customer, and whether you’re making your payments on time and in full. A new user will likely have a lower limit than someone with a longer history, so if it’s your first time using Afterpay, you might have to stick with purchasing smaller-ticket items. The average Afterpay order is only $150.

One major advantage of using Afterpay, over other POS providers, is that it doesn’t affect your credit score at all — the company doesn’t check your credit score, and it doesn’t report any loan information to the credit bureaus.

A major drawback of using Afterpay are the late fees. You’ll be hit with an $8 fee, or 25% of your transaction, whichever is less, for each late payment. If you fail to make a payment, you won’t have access to the platform to take out a new loan until you make a payment.

When it comes to availability, Afterpay can be used at more than 100,000 merchants around the world including American Eagle, Bed Bath and Beyond and lululemon. Afterpay also offers some consumers the ability to use the app to make purchases at select retailers such as Nike, Kroger, Amazon and Macy’s. Whenever you use the app, you’ll be given a one-time virtual card.

Much like the other POS providers in this round-up, Afterpay has poor customer service reviews on the Better Business Bureau website. It had a 1.38/5 average rating based on 98 customer reviews at the time of writing. Many of the customer complaints focused on canceled orders from the merchant or failure to receive a refund from Afterpay. BBB gives Afterpay an A- rating based on its own ratings system.

Who’s this for? Zip, formerly known as Quadpay, is a BNPL service available internationally. Zip is a good choice for consumers who want to use a BNPL option wherever they shop, and they don’t want it to affect their credit score.

Zip has one product that’s similar to Afterpay: consumers can make a purchase and pay it off in four interest‑free installment payments over six weeks. Much like PayPal ‘Pay in 4’, Zip has a value limit on orders, so you can only spend up to $1,500 (but maximum amounts vary by retailer).

Much like the other BNPL providers, Zip doesn’t report these loans to the credit bureaus. It also doesn’t perform any credit checks before approving customers for a loan.

One of the major perks of Zip is how easy it is to use at most retailers. Zip is connected to over 51,000 merchants globally, including Sears, Target, Apple, Zara and ASOS, and customers can also use the app or the browser extension to shop at retailers that are not integrated with Zip.

Whenever you use the app or the browser extension, you’ll receive a virtual, one-time card to fund your purchase either in-store or online. That means you can use Zip to pay for dinner or groceries in-person as well as for your online clothing orders.

However, Zip does come with one major drawback: It’s the only BNPL provider we reviewed that charges a convenience fee. Zip charges customers $1 per payment you make or a $4 fee for your order.

There is some flexibility with payment due dates. If a customer is one day late for a payment or has a delayed paycheck, Zip may move payment due dates if you contact the company and request more time.

Of the BNPL providers that we reviewed, Zip also has the highest customer satisfaction rating with the BBB with a 4.01/5 average rating based on 1,191 customer reviews at the time of writing. BBB gives it an C rating based on its own rating system, and Zip is not accredited.

Who’s this for? PayPal is a global financial technology system known for its online payments system. It recently launched its own BNPL product known as “Pay in 4,” which is a good option for people looking for a short-term financing option with 0% interest, no late fees that aren’t reported to the credit bureaus.

PayPal’s ‘Pay in 4’ allows consumers to make four installment payments due every two weeks over a six-week period. The first payment, like a down payment, is due at the time of purchase.

Consumers are limited to taking out loans less than $1,500, so it’s not a great choice if you’re looking to finance a really expensive purchase.

What distinguishes PayPal’s ‘Pay in 4’ from other short-term BNPL providers Afterpay, is that it doesn’t charge any late fees. It also does not report to the credit bureaus, so it won’t affect your credit score.

When it comes to determining your eligibility for a loan, PayPal doesn’t check your credit score most of the the time. It will, however, occasionally perform a soft credit check. According to a representative at PayPal, the company uses “vast consumer data to understand an applicant’s creditworthiness.”

PayPal ‘Pay in 4’, unlike the other BNPL providers on the list, doesn’t have a separate app, or browser extension or website that allows consumers to use the service at online or in store retailers not integrated with the company. PayPal does, however, have the advantage of being an established, multinational financial technology company, so it has millions of merchants available such as Uniqlo, Estee Lauder, Target and Best Buy.

Since ‘Pay in 4’ is one of many products offered by PayPal, it doesn’t have a separate BBB customer service rating.

Select focused on the following features when examining popular BNPL providers:

• APR: Some BNPL loans charge interest while others do not. Even if consumers pay off their installment payments on time and in full, they may be charged interest or an average percentage rate (APR) on their loan.
• Reporting to credit bureaus: Some POS loan providers report some or all loans to the credit bureaus while others report none. Additionally, some providers only report to some of the credit bureaus ⁠— Equifax, Experian and Transunion ⁠— while others report to all of them. Since POS loans have the potential to decrease your credit score regardless of whether you make your payments on time and in full (by decreasing the average age of your credit history), it’s important to carefully read the terms of the loan to know if your score could be impacted.
• Late fees and other fees: Most BNPL providers only charged late fees if you failed to make your installment payment on time. However, some also charged convenience fees when you take out a loan.
• Credit checks: There are two types of credit checks, a hard credit check or a soft credit check. Hard credit checks can usually cause a small drop in your credit score, while soft credit checks have no impact on your credit score (while also looking at factors beyond someone’s credit scores). (Affirm, however, did not disclose what specific factors they looked at.)
• Available merchants: We not only looked at the number of merchants that were directly integrated with the provider but also whether consumers could shop at merchants not partnered with the provider. Many BNPL providers either had an app, a browser extension or a website that enabled consumers to use a one-time card which gave them access to a BNPL loan to finance their purchases.