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. The Finder Score crunches 3+ types of short-term loans across 65+ lenders. It takes into account the product's interest rate, fees and features, as well as the type of loan eg investor, variable, fixed rate - this gives you a simple score out of 10. To provide a Score, we compare like-for-like loans. So if you're comparing the best short-term loans for all credit types, you can see how each short-term loan stacks up against other short-term loans with the same borrower type, rate type and repayment type.
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.What are PayPal Pay in 4’s interest rates?
Is PayPal’s buy now, pay later safe?
PayPal Pay in 4 vs. PayPal Credit
Pay in 4 vs. other buy now, pay later companies
Service Payment Interest Late fees 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 Compare cash advance alternatives to PayPal Pay in 4:
Compare other productsHow we picked these
What is the Finder Score?
Is Pay in 4 worth it?
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