What it is
At a partner shop, a purchase is split into 3 or 4 payments. Often free if you pay on time: the shop pays the fee, not you. Fees begin when you pay late or choose a longer term.
Who it suits
Buying a phone or appliance, with the money for each payment on the day it is due.
What it usually costs
A $150 phone in 3 payments is $50 each, $150 in total. Choose 6 payments at 4% and you repay $156. Miss one payment and a late fee is added. Ask how much before you buy.
See what it costsWhen not to use it
- If you are buying something you do not really need. It makes spending too easy.
- If you have several of these running at once. Small payments add up fast.
- If you are not sure you will have the money on the next due date.
Questions to ask
- 1.What is the total in dollars if I pay everything on time?
- 2.What is the late fee, per missed payment?
- 3.Can I return the item and stop the payments?