2023 Update: Pay it Later has collapsed since this article and has been accused of leaving small business owners who used their service as payment option in the lurch. As always, I am skeptical of fast easy credit, so approach any credit options with caution.
Pay It Later exists in a market saturated with Buy Now Pay Later services. With so many options you may find yourself wondering: what is the difference? Pay It Later may offer a few unique benefits - including the option of buying secondhand goods from places such as Facebook Marketplace and paying them off in instalments. If you are considering signing up, read on to find out the pros and cons of using Pay It Later.
What is Pay It Later?
Pay It Later is an Australian Buy Now Pay Later company founded in Brisbane. It allows you to make purchases and pay them back over 4 weekly instalments. Apart from the weekly rather than fortnightly payments, what makes Pay It Later different from other Buy Now Pay Later services is the ability to buy directly from other people. This makes it useful if you are making purchases of secondhand goods from places like gumtree.
Who owns Pay It Later?
Pay It Later is an independent Australian company and is not owned by a larger finance company. It is currently owned by private investors and is not listed on the ASX
Is Pay It Later Australian?
Yes, Pay It Later was founded in Australia and is currently run from Brisbane.
How does Pay It Later work?
Pay It Later works by using your credit or debit card to set up a payment plan. Rather than paying the full amount of your purchase on the spot, Pay It Later lets you set up a payment plan, then charges your card in 4 instalments until the balance of your purchase is paid off.
How to use Pay It Later
In order to sign up for Pay It Later you need to fill out a form on their website then download the app. Once you have signed up you can use it like a regular Buy Now Pay Later Service. You shop as usual then choose Pay It Later as your payment option. You will then set up and accept a payment plan. You make your first repayment on the spot, then 3 more weekly instalments.
What stores have Pay It Later?
Pay It Later is not currently available as a payment option for large retailers. It's stores include a list of boutique retailers, and interestingly, many gel blaster stores. It's biggest strength is not the amount of stores it is available in, but it's P2P capability. This allows you to pay instalments for second hand goods.
Can you use Pay It Later in store?
No, Pay It Later is an online only service. Most of the stores that use Pay It Later are online only retailers.
Pay It Later fees
Pay It Later is light on fees for consumers. If you make your repayments on time, you will not be charged interest or account keeping fees. However, late payment fees do apply, and they are not capped as Afterpay fees are. If you miss a payment you will be charged $10 24 hours after the repayment is due. If you have still not paid within a week you will be charged another $10. The website does not make it clear, but if you continue to miss payments these fees could quickly stack up.
Late payment fee (24 hours): $10
Overdue fee (7 days): $10
Does Pay It Later do credit checks?
Pay It Later states that they may conduct credit checks through a third party. Although they claim to offer a Buy Now Pay Later service with no credit checks, this is a risky thing for a company to do when lending out money. Instead of a credit check they claim to conduct an assessment that includes identity checks. As part of this they will conduct a soft credit check to ensure that you have a decent credit score. This is what is known as a soft credit check, and will not show up on your credit file. This is how they are able to claim that they do not conduct credit checks. If your credit score is very low and you have defaults on your file they may refuse your application.
What is the Pay It Later credit limit?
The purchase limit with Pay It Later is $1000.
Is Pay It Later interest free?
Yes, if you make your repayments on time then Pay It Later is interest free and free of other fees too.
Can I buy secondhand goods from gumtree and marketplace with Pay It Later?
Yes, you can buy secondhand goods with Pay It Later. When making a transaction, go to the app and select the P2P option. This lets the seller generate a barcode that the buyer can scan. This will set up a payment agreement. This is a more secure way to sell goods on a payment agreement, as the money is automatically deducted from the buyers credit or debit card. If the buyer doesn't have the money, Pay It Later will assist with debt recovery.
Can you sell stuff with Pay It Later?
Yes, you can sign up as a merchant either as a small business owner, or as a seller using their P2P platform. P2P stands for person to person. You can use this service to sell things on gumtree or Facebook marketplace.The P2P function can be accessed through their app and does not need a second download.
What is Pay It Later P2P?
Pay It Later P2P is part of the Pay It Later app, and allows you to buy and/or sell goods secondhand using instalments. It lets you buy things off Facebook marketplace or gumtree and pay them off. This is a big advantage for people that like the convenience of Afterpay but would prefer to make big purchases secondhand. To use this feature the seller will generate a QR code in their app, which the buyer then scans to accept the payment plan. It would be a very useful tool for buying things like appliances, furniture or vehicles secondhand, especially if you don't have the money to outlay straight away. For more info go to their website.
Pay It Later merchant fees
Pay It Later is a little more expensive for merchants than other Buy Now Pay Later services. A transaction will cost you 5.9% of the purchase price plus a flat $1.90 fee. This applies if you are a seller, not if you are buying something.
Is Pay It Later legit?
Pay It Later is definitely a legit company, with over 10000 current users according to Google Play app downloads. However, they are a small startup and there are still a few kinks being ironed out when it comes to their operations. For instance, when you go to the terms and conditions on their website, there is a blank page that says "enter your site terms and conditions here". This tells me that their website is incorrectly set up and is made using a website builder rather than a web developer. There is also a spelling mistake in one of their site menus. Now, I don't want to be THAT guy, but these things tell me that they are not as professional as they are making themselves out to be. I still think the service they offer is potentially valuable, as no Buy Now Pay Later service is currently supporting the sale of secondhand goods. And dealing with a small business means that you often get better, more personal service. However, I would exercise caution opening an account with them.
The Bottom Line
Pay It Later is not available at chain stores so is not a convenient option if you like to use Buy Now Pay Later regularly. However, if you want a Buy Now Pay Later service that you can use for secondhand goods - this is the app for you. For more reviews of popular Buy Now Pay Later Services, head to this article. And if you want to learn how to budget to reduce your reliance on credit, head to our article about saving money. Happy budgeting!