Best Buy Now, Pay Later Apps

Affirm comes out on top as the best app for buy now, pay later purchases

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Many retailers have partnered with buy now, pay later (BNPL) apps to make it easier for people to make purchases on their websites. These BNPL apps are similar to credit cards because they allow you to buy something today, then pay for it over time. One of the biggest differences, though, is that many do not charge any interest as long as you make the scheduled payments.

The BNPL apps are easy to use, have low fees and interest rates, and credit limits that allow for common purchases. To help readers find the best BNPL apps, we researched and reviewed top buy now, pay later services to find out which ones work best for a variety of consumers.

Best Buy Now, Pay Later Apps of 2022

Best Overall : Affirm


Affirm

Affirm

  • Purchase limit of $17,500
  • Soft credit check to prequalify
  • Payments of three, six, or 12 months are typical
Why We Chose It

Affirm is our choice for the best overall buy now, pay later app because it has no fees of any kind, not even a late fee. For transactions that do charge interest, Affirm charges simple interest, which means that your interest charges won't compound and grow larger.

Pros & Cons
Pros
  • No late fees

  • Make purchases online or in-store

  • Choose the payment schedule that works for you

  • Purchases up to $17,500

Cons
  • Some transactions charge interest

  • Most transactions require a credit check

  • No physical credit card

Overview

Affirm is a publicly traded company that is located in San Francisco, California and was founded in 2012. It has financed 17 million purchases. Customers can borrow up to $17,500 and pay over time with no interest or interest rates from 10% to 30%, depending which payment plan they choose. Most loans are repaid in three, six, or 12 months without any additional fees (only interest), making this the best overall choice. Longer terms may also be available in some situations.

When you make a purchase with Affirm, you always know exactly what you're paying and when the payments will be done. Many retailers offer Affirm as a payment option when checking out. When it's not an option, you can still pay over time by creating a virtual credit card number online or through the Affirm mobile app to purchase in-store or online.

Read the full Affirm review.

Best for Flexible Payment Plans : Sezzle


Sezzle

Sezzle

  • Credit limits vary
  • Soft credit check
  • Four payments over six weeks
Why We Chose It

Our choice for the buy now, pay later app with the best flexible payment plans is Sezzle. Sezzle sets itself apart by allowing customers to reschedule payments to give themselves up to two weeks of additional time.

Pros & Cons
Pros
  • Push payments up to two weeks later

  • First reschedule per order is free

  • No interest on purchases

Cons
  • Requires 25% down payment upon purchase

  • Additional payments aren't rescheduled if you don't select option

  • A fee for additional reschedules

Overview

Sezzle is based in Minneapolis, Minnesota, and is a publicly traded company that operates in the U.S., Canada, Germany, and several other countries. The company is a Certified B Corp., which means that it uses its profits and resources to support a public benefit. It has 3.4 million active customers and there are now over 46,000 active merchants on the platform where customers can buy now and pay later.

Like many BNPL apps, it requires a 25% payment immediately and three additional payments every two weeks. However, Sezzle allows customers to reschedule payments up to two weeks later, making it the leader for best for flexible payments. The first reschedule for each order is free, then each additional payment reschedule for that order incurs a fee.

Best for Students : Afterpay


Afterpay

Afterpay

  • Credit limits start at $500
  • No credit check, no minimum score
  • Purchases are split into four equal payments
Why We Chose It

The best buy now, pay later app for students is Afterpay because it utilizes smart credit limits to ensure customers can afford to pay for purchases. There is also a virtual card in the app for in-store purchases.

Pros & Cons
Pros
  • Smart credit limits help you stay under budget

  • Sends reminders so you don't miss a payment

  • No fees when you pay on time

Cons
  • Afterpay may decline your order

  • Late fees can be as high as 25% of order amount

  • Each purchase must be approved by Afterpay

Overview

Afterpay, founded in 2014, is an Australian company that operates in its home country, New Zealand, the U.K., E.U., Canada, and the U.S. It now has 20 million customers from around the world. It works with over 100,000 brands, so customers have many choices for shopping.

Browse participating stores online or in person to make purchases with no fees or interest, as long as you make all scheduled payments. Each purchase you attempt to make is subject to an instant approval decision using smart credit limits, which is why it is great for students with limited financial resources.

To shop in-store, log into your account via the Afterpay mobile app, then add the virtual card number to your mobile wallet and tap to pay. You'll make the first of four equal payments immediately, then each of the remaining three payments every two weeks. As long as your purchase is approved, your order will ship as usual. If a payment is late, you'll be charged up to 25% of your original order amount.

Read the full Afterpay review.

Best for No Credit Check : Splitit


Splitit

Splitit

  • Uses the existing credit of your credit cards
  • No credit check
  • Payments for three to 24 months
Why We Chose It

Splitit is our choice for the best BNPL app with no credit check. Instead of issuing you more credit, Splitit uses your existing Visa, Mastercard, Discover, or Union Pay credit card to make purchases.

Pros & Cons
Pros
  • No applications, credit checks, or registration required

  • Uses your existing credit card limits

  • No need to worry about approval for new credit

Cons
  • You must have a credit card with available credit

  • Does not build credit beyond normal credit card use

  • Not available with Amex cards

Overview

Splitit is a publicly traded company based in New York City and founded in 2012. It has partnered with Wix, Big Commerce, Woo Commerce, Shopify, and more to expand its offerings. With Splitit, customers can continue to use their Visa, Mastercard, Discover, and Union Pay credit cards to earn rewards on their purchases and pay over time with no interest. Splitit does not charge consumers any interest or fees, including late fees. Obviously, interest can still be charged by your credit card company.

Simply select Splitit at checkout, choose how many installments they'll make to pay off the balance, and enter their credit card information—there is no credit check. Splitit does not require an application or registration to use their service. There is no interest charged and no late fees charged by Splitit.

When making a purchase, your available credit is reduced by the total purchase amount as a pending transaction on your credit card. Each time a payment is due, the payment will be charged to your card and the pending amount will be reduced by the same amount. The process repeats until all payments are made.

Best for Bad Credit : Perpay


Perpay

Perpay

  • Does not use credit history
  • Spending limits of $500 to $2,000
  • Payments from your paycheck
Why We Chose It

The winner of the best BNPL app for those with bad credit is Perpay because it does not check credit history and uses your verified income to set your spending limits.

Pros & Cons
Pros
  • Does not check credit history

  • Spending limit based on current income

Cons
  • Spending is limited to Perpay's marketplace

  • Items are not shipped until first payment is made

  • All scheduled payments must be made through payroll direct deposit

Overview

Perpay was founded in 2014 and is currently located in Philadelphia, Pennsylvania. With over three million members, Perpay was named the fifth-fastest-growing private company by Inc. Magazine in 2019. Customers are able to shop from over 1,000 of the top brands through the Perpay marketplace. With on-time payments, the average customer increases their credit score by 39 points, giving it the edge for consumers with bad credit trying to repair it.

After completing your Perpay profile, customers can access their spending limit and start shopping within 60 seconds of joining. Your items are not shipped until your first payment is made, which is typically your next payday. Instead of the typical four payments of 25% each that other BNPL services utilize, Perpay allows users to choose the number of payments and the frequency of these payments is the same as their paycheck frequency.

Required payments are made through direct deposit from your payroll. Other forms of payment are not accepted unless you are making extra payments. Perpay helps customers build credit by reporting your positive payment history to the credit bureaus after completing four months of on-time payments with a combined total of at least $200.

Best for Small Purchases : PayPal Pay in 4


PayPal

 PayPal

  • Per transaction limit of $1,500
  • Soft credit check may be needed
  • Four equal payments
Why We Chose It

PayPal Pay in 4 is our choice for the best small purchases buy now, pay later app because it focuses on transactions of $30 to $1,500.

Pros & Cons
Pros
  • PayPal is a familiar brand name

  • Interest-free payments

  • Can use at millions of online merchants

Cons
  • Maximum purchase of $1,500

  • Not available in all 50 states

  • Each purchase requires an approval decision

Overview

PayPal is one of the original online payment processing platforms for person-to-person payments. It has been expanding to in-store and online purchases for years and is now one of the most recognized payment options among consumers. Pay in 4 is available at millions of online merchants, such as Nike, Best Buy, and Target for transactions ranging from $30 to $1,500, making it our choice for small purchases.

To use Pay in 4, you must have a PayPal account in good standing, or open one at the time of purchase, that is linked to your bank account, debit card, or credit card. During checkout, select Pay in 4 when you check out with PayPal to receive an approval decision within seconds. 

You'll pay a down payment at the time of purchase and three subsequent payments every two weeks thereafter. Pay in 4 is not currently available to residents of New Mexico, North Dakota, Missouri, Wisconsin, Nevada, and all U.S. territories.

Best for Large Purchases : Klarna


Klarna

Klarna

  • No predefined credit limit
  • Soft credit check
  • Four equal payments
Why We Chose It

Klarna is our choice for the best buy now, pay later app for large purchases because it offers up to 36 months of financing and its virtual card numbers can be used at any online or in-person retailer.

Pros & Cons
Pros
  • Can be used wherever credit cards are accepted

  • One-time use card numbers provide enhanced security

  • No interest or fees when payments made on time

  • Earn rewards with its Vibe loyalty program

Cons
  • Each purchase must be approved by Klarna

Overview

Klarna was founded in 2005 in Sweden. It has since expanded within Europe and to the U.S. and boasts 147 million active customers and over 400,000 merchants across 45 countries. However, you can now use Klarna to turn any purchase into smaller payments at every store that accepts credit cards. Klarna does not impact your credit when using the pay in 4 option.

During checkout, create a virtual card in the Klarna app and use that number to complete your purchase. One payment option is to pay off your purchase in four equal payments. The first is due immediately and the remaining three are paid every two weeks. Klarna does not charge interest or fees as long as you make all of your scheduled payments on time.

Customers also have the option to pay the balance in full within 30 days with no interest. Another option is to use six- to 36-month financing to handle larger purchases helping it win this category. This longer-term option does charge interest.

Read the full Klarna review.

Final Verdict: Best Buy Now, Pay Later

Buy now, pay later apps are gaining in popularity among consumers. They can offer interest-free financing and simplified repayment structures to keep people from getting into financial trouble. Our choice for the best buy now, pay later app is Affirm. Affirm does not charge any fees, including the pesky late fees that most competitors charge. You can make payments online or in-store and choose the payment structure that works best for your finances.

Compare the Best Buy Now, Pay Later Apps

Company  Number of Installments Interest Rate Amount Due at Purchase Late Fees Popular Brands
Affirm Best Overall Varies 0%; 10% to 30% Varies None Walmart.com, Peloton, Expedia, Pottery Barn
Sezzle Best for Flexible Payment Plans 0%  25% None Umbro, GameStop, Altitude Sports, Public Rec
Afterpay Best for Students 0%  25%  $8  Old Navy, Bed Bath & Beyond, Forever 21, adidas
Splitit Best for No Credit Check 3 to 24  0%  Varies None  Echelon Fitness, GlassesUSA, REST
Perpay Best for Bad Credit Varies 0%  Varies  None Samsung, Apple, Beats, Nintendo, Michael Kors 
PayPal Pay in 4 Best for Small Purchases 0% 25%  None Fossil, Bed Bath & Beyond, Lands' End, ALDO 
Klarna Best for Large Purchases Up to 36 months  0% to 19.99%  Varies  Are charged Sephora, Bed Bath & Beyond, Nike, Tommy Hilfiger 

How to Choose the Best Buy Now, Pay Later App

There are many BNPL apps to choose from when buying goods and services. However, most retailers partner with just one BNPL app, so their partner may be the easiest service to work with to complete your purchase.

Assuming that you have a choice of which service to use, here's how to choose the best buy now, pay later app for your purchase.

  • Consider your credit score. If you have bad credit or a thin credit history, it may make sense to select a BNPL app that does not check your credit score.
  • Will it report to the credit bureaus? People who are working on their credit will benefit from their on-time payments if the BNPL app reports their activity to the major credit bureaus.
  • Where is the BNPL app accepted? When you are applying for a BNPL account, choosing one that is accepted at many of the stores you shop at will keep you from opening multiple accounts.
  • How much of a credit limit will you receive? The credit limits of BNPL apps vary from company to company. Depending on the size of your purchase, having a larger credit limit may make the difference between being able to complete your transaction or not.
  • What are the fees and interest rates charged? Review the account details to determine if there are any fees for using the service, making a payment, or other activities. Also, will you be charged interest if you make your payments on time? If so, what are the rates?

When to Use a Buy Now, Pay Later App vs. a Credit Card

While buy now, pay later apps are similar to credit cards, they each have a role to play for today's consumers. During checkout, you'll have to decide which method you want to use to complete your transaction. Here are a few situations where you'd want to use one form of payment over the other.

When to use a BNPL app:

  • Make purchases without a credit inquiry
  • Simple application with instant decision for new credit
  • Pay over time without being charged interest
  • Pay off purchases with minimum payments
  • Build credit without getting a secured credit card

When to use a credit card:

  • Special discounts for using a store-branded retail card
  • Earn cash back, miles, or points on your purchase
  • Meet a minimum spend requirement to earn a welcome bonus
  • Earn benefits based on your annual spending totals
  • Price, return, and purchase protection benefits
  • Receive a complimentary extended warranty
  • Flexibility of lower minimum payments

Not all credit cards provide these benefits, so review your credit card's benefits guide or call customer service to verify if your card does. Otherwise, it might be time to replace your credit card with one that offers better benefits.

How Do Buy Now, Pay Later Apps Work?

BNPL apps work in coordination with the merchant that you are purchasing from. Most do not charge interest as long as you make the scheduled payments on time. If you miss a payment, you may be charged interest and a late fee. The BNPL app earns a fee from the merchant for processing the transaction, similar to how a credit card transaction works. It's a win-win situation because the customer receives their product today, the merchant makes a sale that might not otherwise have happened, and the BNPL app earns a fee for handling the financing.

Can Buy Now, Pay Later Apps Help You Build Credit?

If your BNPL app reports to credit bureaus, then your positive payment history will help build your credit score. For example, Perpay customers increase their credit score by an average of 39 points. However, many of these BNPL loans are short-term in nature and, therefore, don't create a payment history that is long enough to report to the credit bureaus.

What Credit Score Do You Need to Use a Buy Now, Pay Later Service?

There is no set credit score required to use a BNPL app. There are many BNPL apps to choose from. While some perform a soft inquiry to check your credit, many others do not require a credit check at all. Even if you have bad credit, services that do not require a credit check enable you to shop today and pay over time by using alternative methods to determine your credit limit.

For example, Zebit has a two-step underwriting process. First, they verify your identity, income, and employment to establish your initial spending limit. Then, each attempted purchase is underwritten at checkout to determine whether or not you can complete the transaction.

Methodology

To find the best buy now, pay later apps, we researched over 20 BNPL services to find those that work best for a variety of shopping goals. For our analysis, we compared ease of purchasing, interest rates, fees, credit checks, how payments are handled, and other relevant features. These data points were assigned a score and weighted based on their importance to each type of consumer. We continuously monitor data from BNPL services to update our rankings to provide our readers accurate recommendations.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. Affirm. "How It Works."

  2. Inc. Magazine. “Introducing the 5,000 Fastest-Growing Private Companies in America."