Don’t Have A Credit Card? You Can Use Pay Later Apps For Small Needs

by Shatakshi Gupta

The Buy Now, Pay Later concept is becoming increasingly popular in the country. Under this, one can get an interest-free loan facility, from which you can buy anything and repay it after a few days. Loan companies and banks bear this cost and give you a moratorium of a few days to repay the loan without interest.

Many e-commerce companies and apps are offering BNPL facilities. India’s Buy Now, Pay Later market in 2020 was around Rs 44,500 crore and by 2028 this market is expected to reach around Rs 3,86,870 crore. Seeing the growth of such facilities, let’s know about BNPL service.

How is it different from a credit card?

You can use credit cards anywhere, anytime. Whereas, BNPL can be spent only with partner merchants. Both offer interest-free time. Credit cards carry interest and other fees. There is a late payment penalty in BNPL, but the cost of the loan is recovered from the merchant instead of the customer.

Is BNPL a loan?

Also read: People Usually Are Unaware Of These Charges On Credit Card; Know Before Using One

You can take a personal loan of up to Rs 40 lakh, whereas BNPL is a small credit. A personal loan comes in your bank account. On the other hand, the account of BNPL remains with the credit company. Apart from this, the repayment period of a personal loan is up to 5 years, while the maximum moratorium is available in BNPL of 6 months.

How to use it?

Register with BNPL loan provider through digital KYC in few minutes. There is no processing fee or joining fee. Use the loan when making purchases on partner merchants. Keep in mind that with this money you can make purchases only with partner merchants of the BNPL firm.

Limit of these BNPL

 Loans ranging from a few thousand to one lakh rupees are available under BNPL. Often, interest is not charged on these, but if these loans are repaid in instalments, then interest will have to be paid. The loan repayment period ranges from 14 days to 6 months. If you are late with the payment, you will also have to pay a penalty.

No need for a very high CIBIL score

 For customers who do not use credit cards, BNPL is a good option. Registration can be done easily. In this, the requirements of credit score or proof of income are less.