The buy now, pay later industry is getting a run for its money. PayPal has entered the fray with a feature called “Pay in 4,” which allows shoppers to finance their purchases in four smaller installments. You can use this plan on items priced between $30 and $1,500, with biweekly payments. Navigate your purchases and money owed directly through your PayPal wallet.
How does this payment plan stack up against similar services like Affirm and Afterpay? We took a closer look.
Note that this service is not currently available for residents of Missouri, Nevada or New Mexico.
Using PayPal’s buy now, pay later service is pretty straightforward:
The new feature may selectively perform soft credit checks, but those won’t affect your credit score, according to MarketWatch’s interview with Doug Bland, vice president of global credit. He added that “Pay in 4” stands out from other buy now, pay later plans because “a lot of consumers want to avoid paying credit card interest and want to borrow money without a credit check.”
It’s worth noting that Splitit and Afterpay don’t perform a credit check, while Klarna and Affirm do.
There are no interest rates when you use Pay in 4, though you could be charged a late fee if you miss a payment. PayPal does not disclose how much those fees will cost, and it can even vary from state to state.
Yes. You’ll enjoy the safety features of PayPal, which includes 24/7 monitoring of transactions, secure storing of your payment information and encryption to protect you while you’re making purchases. If you don’t receive your item or it shows up not as advertised, PayPal will refund the full purchase price and shipping costs in most cases — though terms and conditions still apply.
If you’re making a pricier purchase, like a roundtrip plane ticket somewhere exotic or a fancy new bed, PayPal Credit is likely a better option. You’ll get a reusable credit line and have six months to pay off purchases of $99 or more.
You won’t pay interest if you make your payments on time with PayPal Credit. However, interest will be charged to your account if you’re late. The APR for new accounts is 23.99% and late fees are up to $40.
While we can’t find mention of whether late payments impact your credit score, we do know that PayPal Credit reports to Equifax, Experian and TransUnion. So it’s possible that your credit score could be affected either negatively or positively based on the timeliness of your payments.
|
Pay in 4 |
Four payments due over six weeks |
No |
No |
|
Affirm |
Choose between 6-, 12- and 18-month payment plans |
10% to 30% APR |
No |
|
Afterpay |
Four payments due every two weeks |
No |
Yes, never exceeds 25% of your initial order value |
|
Splitit |
Choose a payment plan from 3 months to 24 months |
No |
No |
|
Klarna |
6-month to 36-month financing |
19.99% APR or no interest if you pay in full before the due date |
Up to $7 |
Select up to 4 services and click “Compare” to check out their features side-by-side.
It depends. If you don’t want to deal with interest and feel comfortable paying off your purchase over a shorter period, this could be a solid financing option. Should you need more time to make your payments (and feel fine about paying some interest!), then Klarna, Splitit or Affirm might be a better choice thanks to longer, more flexible payment plans.
The Finder buy now, pay later (BNPL) report looks into how many American adults used BNPL services in the last six months.
Use our easy search to view top stores that accept Klarna financing to buy now and pay later. Plus how it works and what interest rates to expect.
These 100+ online stores accept PayPal. The list includes online retailers like F21 and ASOS, travel booking agents like Expedia and Uber and more.
Get financing for your next big purchase with APRs as low as 0%.
Find out every store in the US that offers Afterpay, the payment system that lets you pay back your purchase in installments.
Finance your online purchase with this alternative to credit cards, available at 150+ stores.