Afterpay Review: Flexible Options for Shoppers Who Want To Buy Now, Pay Later

GOBankingRates Score

4.7
Quick Take: If you've ever needed to buy something and thought how nice it would be to push back the payment without having to pay interest and finance charges, you'll be happy to hear there's already such a thing. Afterpay is one of the "buy now, pay later" platforms that give you the option of splitting up your purchase into digestible amounts that won't wreck your budget. The service can help you free up your cash flow by breaking your purchases down into four installments. Here's what you need to know before you get started.
  • Fees
    4.9
  • Ease of Use
    4.7
  • Mobile App
    4.8
  • Customer Experience
    4.5
How did we calculate this?

Pros

  • You won't be charged any fees or interest (for on-time payments).
  • You'll receive instant approval.
  • You can manually pay your bill or schedule your installments to automatically draft.
  • Payments can be scheduled with a debit or credit card.
  • You can change your payment due date.
  • You can make custom payments.

Cons

  • Afterpay is only available at participating online and brick-and-mortar retailers.
  • Late fees can amount to up to 25% of your initial order value.
  • Afterpay is not available with Capital One credit cards.
  • Only one order is allowed at a time until you build a history with Afterpay.

What Is Afterpay and How Does It Work?

Afterpay launched in Australia in 2015 as a new and improved Gen Z form of layaway. Instead of paying off the layaway before you can take the product home, you purchase the product with Afterpay and pay it off in installments.

You don’t need an account to start shopping with Afterpay when you shop online with a merchant that accepts Afterpay as a payment method. When you use it for the first time, you’ll be prompted for payment details. Afterpay will create your account automatically after it approves your purchase.

If you’d rather set up an account before you shop, you can register online or via the app, which Afterpay recommends downloading to your phone. Once you’re approved, you’ll need to follow the on-screen instructions and add the Afterpay virtual card to your Apple or Google mobile wallet.

Afterpay will decide how much you can spend based on your relationship — initially, you may only be allowed to push back payments on one purchase. If you spend responsibly and make your payments on time, Afterpay will approve larger installments and multiple orders at a time.

You can shop online or in-store at a growing list of participating retailers. Afterpay claims there are nearly 100,000 merchants worldwide. Some of the stores include:

  • Old Navy
  • Bed Bath & Beyond
  • Gap
  • Urban Outfitters
  • Forever 21
  • DSW
  • MAC Cosmetics

If you’re planning on shopping at a store location, you can find retailers through the mobile app and see how much you’re approved for. Once you’re ready, use the virtual card stored in your mobile wallet to pay. For purchases at online stores, select Afterpay as your payment method and follow the prompts.

The service is free as long as you make your payments on time. You can add a credit or debit card as your preferred payment method and let Afterpay set up automatic withdrawals for the four installments. It’s the best way to ensure you don’t make a late payment, especially if you have several orders set up for installments. The late fee can be as high as 25% of the order value.

You can also manually make payments when they’re due by tapping or clicking “PAY NOW” on the app or website. Your first payment is due at the time of purchase, with the remaining three installments due every two weeks. However, users with a proven track record of on-time payments sometimes get an automatic two-week deferral for their first payment. You’ll receive a notification either way.

User Experience

Afterpay is a great way to avoid the high interest rates you’ll pay if you use a credit card to pay your balance off over time. Here’s more about what it’s like to be an Afterpay customer.

Customer Service

To get in touch with customer service, go to the help section of the Afterpay website and click a “Get in touch” button to open a list of possible issues. Select the appropriate one, and then fill out the contact request form that appears on the next screen. Afterpay has digital support representatives on duty seven days a week who respond to requests as quickly as possible, usually on the same day they receive them.

Mobile and Digital Experience

The mobile app is the best way to find your favorite retailers, see how much you have available for spending and manage your installments. Customers give the app a near-perfect score:

Convenience and Ease of Use

Using Afterpay is easy. You occasionally may be declined for a purchase if Afterpay is concerned you’re not spending responsibly, but generally, using the platform is a pleasant experience.

Afterpay Fees

There are no fees except late fees that can amount to up to 25% of your initial order value.

Afterpay vs. Competitors

Afterpay isn’t the only platform available for deferring payments, but it’s one of the best ones. Here’s a look at how Afterpay stacks up against its competitors.

Platform Best For
Afterpay No fees
Zip (formerly Quadpay) Shopping everywhere
Affirm Longer repayment terms
Klarna More payment options

Afterpay vs. Zip (Formerly Quadpay)

Unless you need the flexibility to shop anywhere Visa is accepted, Afterpay is the better option. Zip does provide you with the freedom to pick any retailer, but you’ll need to apply for approval for each purchase, and you’ll pay a fee of $1 per installment payment for the convenience.

Afterpay vs. Affirm

Affirm lets you pay off your purchases over a term of your choice — six weeks or up to 12 months. However, Affirm might charge you interest of up to a 36% annual percentage rate on payment plans longer than six weeks.

Afterpay vs. Klarna

Klarna and Afterpay both work with a list of participating retailers, but Klarna gives you more payment options. With Klarna, you can pay back your purchase in four installments; pay the full balance in 30 days after the item is delivered; pay off your purchase over six months; or go with up to 24-month financing. You might have to pay interest on any payment plan longer than 30 days.

Final Take

Afterpay can’t be beat — what other method of payment lets you defer your payments over six weeks for free? And best of all, using the service won’t affect your credit. If you manage your spending responsibly, being able to break up larger purchases into four smaller installments can help you manage your cash flow better.

Editor’s Favorite

Afterpay’s payment flexibility is the best part. Competing platforms typically lock you into automatic installment payments. You can change your payment due date and even adjust the amount you’d like to pay by manually paying your installments using the “PAY NOW” button.

Afterpay FAQ

Here are the answers to some commonly asked questions about Afterpay.
  • How many orders can you have with Afterpay?
    • Having more than one order at a time requires an established relationship. You'll only be able to have one open order at first, and as you make your payments on time, you'll get approvals for more. 
  • What stores accept Afterpay?
    • The growing list of participating retailers includes Old Navy, Bed Bath & Beyond, Urban Outfitters and Forever 21.
  • How long do I have to repay my Afterpay purchase?
    • You'll have six weeks to pay off your order balance. The first 25% is typically paid at the time of the purchase, with the remaining three installments due every two weeks.

Daria Uhlig contributed to the reporting for this article.

Information is accurate as of July 14, 2022.

Editorial Note: This content is not provided by Afterpay. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by Afterpay.

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About the Author

Cynthia Paez Bowman is a personal finance writer with degrees from American University in international business and journalism. Besides writing about personal finance, she writes about real estate, interior design and architecture. Her work has been featured in MSN, Brex, Freshome, MyMove, Emirates’ Open Skies magazine and more.
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