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Buy Now Pay Later – What Do I Need to know?

What is a Buy Now Pay Later arrangement/contract?

It is a contract where you borrow money from a company to purchase goods or services. You receive the goods immediately and then pay the borrowed money off every fortnight.


Do I pay interest or fees on a Buy Now Pay Later contract?


If you make your repayments on time, you do not pay interest, fees or charges. However, if you make a payment late you will be charged a late fee.


Is a Buy Now Pay Later Contract like a credit card?

A Buy Now Pay Later contract is like a credit card because you are borrowing money from a company. However, the Buy Now Pay Later company does not charge you interest.


Also, if something goes wrong, you have less legal protections with a Buy Now Pay Later contract than you do with a personal loan or credit card.

Is a Buy Now Pay Later contract like a layby?

No. If you layby a product you do not receive the goods until you have paid for them in full.


Do Buy Now Pay Later schemes have the responsibility to assess whether I can afford to pay the money back?


No, unlike banks and other lenders, Buy Now Pay Later companies are not required to assess whether you can afford to pay the money back.


Is there a limit on the number of Buy Now Pay Later contracts that I can have?


No, there is no limit placed on the number of Buy Now Pay Later contracts that you can have.


Can I ask a Buy Now Pay Later company for financial hardship?


There is no law that requires a Buy Now Pay Later company to help you with financial hardship if you get into financial trouble. However, you should still always ask the company for financial hardship as some companies have procedures that look at try to help people in financial hardship.

Do I have to pay the money back?


Yes you have to pay the money back.



Does not paying a Buy Now Pay Later contract affect my credit report?


Like any many debts, if you do not pay the debt there is a risk that the non-payment could be listed as a default on your credit report. Some Buy Now Pay Later companies have said that they do not default list people who do not pay. However, legally default listing is something that in many circumstances they would be allowed to do.


Where can I get assistance if I have a problem with one of these contracts?


You are also able to call a Financial Counsellor on 1800 007 007 or Legal Aid Queensland on 1300 65 11 88 for assistance.


Before you ‘buy now, pay later’ click here to find out more:

https://www.moneysmart.gov.au/borrowing-and-credit/other-types-of-credit/buy-now-pay-later-services





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