Considering a Buy Now, Pay Later service? Try this type of credit card instead

By | August 6, 2022
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Buy now, pay later may be readily available, but 0% APR credit cards have more to offer.


Key points

  • Buy now, pay later is a way to pay off purchases over time.
  • Consumers interested in financing purchases are normally better off with a 0% APR credit card.
  • Credit cards can be used for several purchases rather than just one, but BNPL is easier to get approved.

If you’ve been shopping a lot lately, especially online, you’ve probably seen a “buy now, pay later” (BNPL) option. Affirm, Afterpay, Klarna and other similar services are practical everywhere now.

As a general rule, it’s best to pay for purchases in full in advance. Payment plans are often a bad decision. Consider this shocking fact of buy now, pay later – two-thirds of users continue to pay for items after they no longer own them.

But you may have to make a major purchase and break it down into smaller payments. While buying now, pay later is convenient, it doesn’t mean it’s the best choice. In fact, 0% APR credit cards are another way to go, and in most cases they are the better option.

BNPL vs. 0% APR credit cards

Buy now, pay later and 0% APR credit cards are both ways to pay off purchases over time. The latter have an APR of 0% on purchases that have an introductory period. When you compare everything they offer, 0% APR cards have some clear advantages.

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Let’s start with the most important detail, which is how long you have to pay off what you buy. While there are several services to buy now, pay later, most offer six-week plans with no interest. You make an initial payment and then an additional payment every two weeks. Some services have longer interest-free subscriptions, but usually for no more than six months.

When you look at the best 0% APR credit cards, most offer the introductory rate for a minimum of 12 months. So where a buy now, pay later plan lets you spread payments over weeks, a 0% APR card lets you spread them out over a year or more.

You also have much more flexibility with a credit card. Imagine getting a card with a 0% APR on purchases for 12 months. You can pay for all the purchases you want during that period, and they all have that 0% introductory rate.

With buy now, pay later, the deal is often only valid for one purchase. To fund items at multiple retailers, you must set up multiple payment plans.

It’s also worth mentioning a few more benefits that many 0% APR cards have.

  • Sign Up Bonuses: An introductory offer where you earn a bonus if you spend enough. For example, “spend $500 for the first three months and earn $200 cashback.” If you’re looking to spend that much anyway, sign up bonuses are an easy way to get some of that cash back.
  • awards: Points or cash back on qualifying purchases. This is another way to get something back from money you already spend.
  • Purchase protection: Free damage and theft protection with eligible purchases. Credit cards with this benefit usually offer it for the first 90 days, so it gives your new purchases some extra protection.
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The advantage of BNPL

There is an area where buying now, pay later has the advantage. It is much easier to get approved as many of these services have no minimum credit requirements. Even if you have a low credit score, you can still qualify.

That’s not the case with 0% APR credit cards. They are usually aimed at consumers with credit scores in the good credit range, i.e. from about 670 to 700 or higher. If you’re currently trying to improve your credit rating, you may have better luck applying for a buy now pay later plan.

If your credit score is high enough for either option, a 0% APR credit card is almost always a better value. You can get more time with no interest, more flexibility in how you use it, and possibly some money-saving perks like a bonus and rewards.

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