Afterpay is a popular buy now, pay later app used by over 14 million customers worldwide. It offers a simple financing solution that splits a customer’s purchase into four smaller payments. There are no interest charges and as long as you pay on time, there are no fees.
US customers can browse and shop at over 23,000 online retailers or through the Afterpay app. Opening an account is simple and does not require a social security number. Afterpay does not check your credit and therefore does not report your account to the credit bureaus. Instead, you start with a small spending limit that increases with responsible use and on-time payments.
The benefits explained
- No credit check required: When opening an account with Afterpay, you do not provide your social security number and there are no serious demands on your credit. This means that those with bad credit or little credit history will not be affected by their low credit score.
- Does not charge interest on purchases: Afterpay’s four-way financing does not charge any interest. The amount of your purchase is divided into four installments, 25% of which is paid immediately. The remaining 75% is paid in equal installments every two weeks over the next six weeks.
- Capping late fees at 25% of the purchase amount: Late fees can add up quickly if you have trouble paying your account on time. Afterpay’s late fees are not cumulative and will never exceed 25% of your original purchase amount.
- Invoice for late fees: If you do not make your payment on time, you will be charged a $10 late fee. Payments not made within seven days of the due date are charged an additional $7. These fees may add up, but will not exceed 25% of the original purchase amount.
- Does not offer other financing options: Afterpay only offers four-way payment financing, so if you need more time to refund your purchase, you should consider other BNPL apps.
- Afterpay may refuse your purchase: On average, Afterpay approves 90% of customer purchases. This means that 1 out of 10 transactions will be refused by the company.
How it works
Opening an account with Afterpay requires basic personal information. Simply enter your email, phone number, address, date of birth, and debit or credit card number. You don’t have to provide your social security number and there is no credit check.
What do you want to know
Not having to provide a social security number means there is no credit check.
You will be given a small spending limit to get started. Many new accounts start with a $500 limit, and the limit gradually increases over time depending on how you use it and on-time payments.
If you pay late, you will be charged a fee and your account will be blocked from further purchases until you update your account. Your account is never reported to the credit bureaus. On-time payments won’t improve your score, and late payments won’t hurt your score.
Although you pay fees for late payments, Afterpay is a good financing option for people who have trouble paying on time because it won’t negatively impact your credit score.
Interest and fees
After buy now, pay later loans never charge interest. These loans are interest free with an initial payment of 25% and payments of 25% every two weeks until the loan is repaid in full.
There are no fees on any Afterpay loan as long as you make your payments on time. If you pay late, late payments are fixed, capped and do not accumulate over time. Customers pay a $10 late fee, plus an additional $7 if payment is not current after seven days. Late fees are capped at 25% of the original purchase amount, so small purchases won’t be inundated with late fees that end up costing more than you bought.
Don’t let late fees of up to 25% get added to your account.
If a payment is late, customers will not be able to make additional purchases until the account is updated. Late payments are never reported to the credit bureaus.
Opening an Afterpay account is simple and does not require a credit check. The app only requires your name, email address, phone number, home address, date of birth, and payment method (debit or credit card).
New customers are approved for lower limits that gradually increase over time based on how you use the account and your on-time payments.
Customers can purchase online or through the Afterpay mobile app. Its application is available for both Apple and android devices and it is highly rated by those who use it. There are over 23,000 retail partners available in North America and a total of 85,000 retailers worldwide. Popular brands include Banana Republic, Puma, Old Navy, Clinique and American Eagle.
When shopping through the mobile app, you can make purchases with Afterpay’s four-way payment financing option. You’ll pay 25% immediately via your stored debit or credit card, then the rest is split into three payments made every two weeks.
Not only can you browse and shop within the app, but you can also view previous orders, make payments on open loans, and personalize your experience. You can also change your payment method and track your deliveries through the app.
Afterpay customer service is online seven days a week, so you can always email them and get a quick response. If you prefer to speak with someone or if your issue requires further attention, you can call customer service at 855-289-6014 Monday through Saturday. Monday through Friday, phone support is available from 7:00 a.m. to 7:00 p.m. CST and 9:00 a.m. to 6:00 p.m. CST on Saturdays.
Afterpay’s online reviews show both positive and negative experiences. Many of the complaints we looked into were about issues with refunds or problems receiving items. To be fair, some of the complaints should have been directed at the retailer rather than Afterpay. These complaints highlight the fact that buy-it-now and pay-later services don’t have the same consumer protections as credit cards, such as the ability to easily dispute a transaction when you’re not satisfied.
Although some customers are unhappy with Afterpay’s service, its top customers use its funding 48 times a year. For negative experiences, what’s impressive is that Afterpay usually responds to reviews in 24 hours or less, which shows their willingness to address complaints immediately.
Afterpay does not provide any other type of product other than quarter-pay loans.
Competition: Afterpay vs. SplitIt
Afterpay and SplitIt are both buy now, pay later apps that are suitable for people with bad credit or little credit history. None of the apps perform credit checks or report your transaction history to the credit bureaus.
SplitIt is a good choice for consumers who have credit cards with available credit. The entire purchase reduces your available credit with an “authorization hold”, but the actual charges do not show until the scheduled due date. This makes it easier for you to avoid paying interest on your purchases because you can choose a payment schedule that works for you, ranging from three to 24 payments.
Our choice between Afterpay and SplitIt is Afterpay. Many buyers choose to buy now, pay later because they want to avoid using credit cards and the associated interest charges. Afterpay does not charge any interest and does not require a credit card to complete a transaction.
|Credit limit||Credit limits start at $500||Based on your existing credit cards|
|Amount due on purchase||25%||First payment|
|Repayment Terms||25% every two weeks||From 3 to 24 installments|
|Credit check required||No||No|
|Minimum credit score||N / A||N / A|
|Late fee||$10; Additional $7 if payment is unpaid 7 days after due date||Nothing|
|Other financing products||Nothing||Nothing|
Afterpay is a solid choice for four-way financing for consumer purchases. The app doesn’t require a credit check, and its spending limits increase over time with responsible use and on-time payments. There are over 23,000 retailers in North America to choose from and you’ll never pay interest or fees on your purchases as long as you pay on time. If you pay late, a small fee applies, but late payments will not be reported to the credit bureaus.
To review the Afterpay buy now, pay later app, we analyzed publicly available information on its website, mobile apps, and other relevant sources. Our review focuses on the features that we consider most important for readers when considering using a BNPL service to fund their purchases. Data points related to interest rates and fees, credit limits, repayment terms, credit requirements, app features, and more. have been collated to provide the most up-to-date details. This information is updated regularly to ensure readers make an informed decision when financing purchases.