Buy now, pay later (BNPL) is an increasingly popular way for consumers to make purchases online and in stores. These point-of-sale installment loans are offered by a number of services, including Affirm, Afterpay, and Klarna. An estimated 39% of consumers have tried a buy now, pay later service at least once, according to one survey. As interest in this type of short-term financing grows, the number of retailers accepting it is also climbing.

Key Takeaways

  • Buy now, pay later is a short-term financing option that is increasingly popular with consumers and retailers.
  • Many platforms offer these point-of-sale installment loans for making purchases at participating retailers.
  • Not all stores accept BNPL as a payment option, but many top retailers are beginning to sign on.
  • BNPL financing can be convenient, but there are some caveats to keep in mind.
  • If a retailer you like doesn't use BNPL, consider using in-store financing or a credit card.

What Is Buy Now, Pay Later?

Buy now, pay later is a type of short-term loan that can be used to pay for purchases online or in stores at participating retailers. There are a number of platforms that offer these point-of-sale installment loans, including:

  • Affirm
  • Afterpay
  • Four
  • Klarna
  • Sezzle
  • Zip (previously Quadpay)

The idea behind buy now, pay later is simple: Consumers can split up payments into four (or more) installments. Depending on the platform, these loans may be interest-free. In a sense, buy now, pay later is similar to layaway, but with one key difference: Rather than having to wait until they've made all the installment payments, consumers can get their purchases right away.

Some credit card issuers and payment processors, including American Express and PayPal, also offer installment payment plans to eligible customers.

6 Major Buy Now, Pay Later Services and Their Participating Retailers

A growing number of retailers accept these point-of-sale (POS) installment loans as a payment method. But where you can shop with buy now, pay later depends on which payment platform you're using. Here's how six major buy now, pay later platforms compare in terms of where you can use each one.

Affirm

You can use Affirm to pay at the following major retailers and other companies:

  • Adidas
  • Best Buy
  • Delta Vacations
  • Expedia hotels and vacation packages
  • Nectar Sleep
  • Neiman Marcus
  • Nike
  • Peloton
  • Poshmark
  • Pottery Barn
  • Purple
  • Reverb
  • Saks Fifth Avenue
  • The RealReal
  • ThredUP
  • Walmart.com

Afterpay

Afterpay works with a variety of retailers, including health and beauty, fitness, apparel, and jewelry stores. Here are some of the top retailers that accept Afterpay loans:

  • Anthropologie
  • Bed Bath & Beyond
  • Dillard's
  • Finish Line
  • Forever 21
  • Houzz
  • MAC Cosmetics
  • Pier 1
  • Tory Burch
  • Ulta Beauty
  • Urban Outfitters

Four

Four works with a number of brands in the men's, women's, beauty, apparel, and accessories space. Retailers that accept Four's buy now, pay later financing include:

  • 360 Mindful
  • Elastique
  • Fetch Eyewear
  • Flyte
  • Hungry Apparel
  • Lotuswei
  • Lexther
  • PawPad

Klarna

Klarna lets you buy now, pay later anywhere online or with the Klarna app. The list of stores that accept Klarna includes:

  • Adidas
  • Bed Bath & Beyond
  • Bloomingdale's
  • Calvin Klein
  • GameStop
  • GUESS Factory
  • H&M
  • Journeys
  • Lenovo
  • Lululemon
  • Macy's
  • Reebok
  • Sephora
  • Stila
  • Tommy Hilfiger

Sezzle

Sezzle partners with retailers that represent men's, women's, kids', and beauty brands. Merchants that accept Sezzle as payment include:

  • Alani Nutrition
  • Bentley
  • Brandless
  • GameStop
  • Itzy Ritzy
  • Jessica Simpson
  • Lamps Plus
  • Melt Cosmetics
  • Monos
  • Umbro Premier
  • Wings+horns

Zip

With Zip, you can use point-of-sale installment loans to make purchases at these retailers and other companies:

  • Airbnb
  • Amazon
  • Bloomingdale's
  • Delta
  • Famous Footwear
  • Instacart
  • Macy's
  • Nike
  • Nordstrom
  • Overstock
  • Target
  • TJ Maxx
  • Ulta Beauty
  • Walmart

Buy Now, Pay Later vs. In-Store Financing

Buy now, pay later financing isn't the only way to pay for purchases over time. Many stores offer their own in-store financing plans.

These typically fall under the umbrella of deferred-interest financing arrangements. With this type of payment plan, you can make a purchase and pay no interest for a set time period, using a store credit card. At the end of the period, any interest that would otherwise have accrued will come due if you haven't paid the balance in full.

Though buy now, pay later financing plans generally allow you to spread payments across four or six installments, deferred-interest financing may give you 12 to 24 months or even longer to pay. Between the two, deferred-interest payments might make sense if you're making a large purchase and want to spread the payments out.

With point-of-sale installment loans, you may pay no interest at all on the purchase. Deferred-interest plans, on the other hand, can become expensive if you don't pay the balance in full before the promotional period ends. Even if you only have a small balance remaining, you could be responsible for paying interest on the entire starting balance.

Buy Now, Pay Later vs. Credit Cards

If a store doesn't accept buy now, pay later as a payment option, consider using a credit card instead. Many credit cards offer benefits that buy now, pay later plans do not.

For instance, you may be able to earn points, miles, or cash back when shopping online or in a store using a rewards credit card. Credit cards may also charge zero interest if you're taking advantage of a 0% introductory purchase APR offer. And you won't owe any interest if you can pay your monthly balance in full.

You also have longer to pay off charges with a credit card, as opposed to four to six installment payments with a point-of-sale loan. But if you're racking up interest each month, carrying a balance can be costly. So before making a purchase with either payment method, consider how long it will take you to pay it off.

Tip

If you're planning a larger purchase, compare the best rewards credit cards to see what you could earn back in points, miles, or cash back.

The Bottom Line

More retailers are beginning to accept buy now, pay later as a payment option. But before agreeing to one of these point-of-sale installment loans, make sure you know how many payments you'll have to make, the amount of each payment, and whether interest will accrue. Also, consider how buy now, pay later loans could affect your credit. Falling behind on a payment could damage your credit score and outweigh the convenience of paying over time.