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PerPay allows you to build credit using its PerPay+ feature.
Perpay; Insider
The bottom line: PerPay buy now, pay later is a great choice for borrowers who would like to set their own repayment schedules. Other buy now, pay later companies only have a few repayment term options, but you get to make as few or as many repayments as you want. It’s good for borrowers who are employed full-time, but not self-employed. Make sure you don’t fall into the trap of using PerPay to buy items outside of your budgetary limits.
What is PerPay?
PerPay buy now, pay later is a buy now, pay later company that allows you to split a purchase into a series of payments that are automatically deducted from your paycheck. Your payments are due each time you get paid.
You will use PerPay’s online marketplace to shop at over 1,000 retailers that allow you to use PerPay at checkout. Some popular companies include HP, Dyson, and PlayStation.
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How does PerPay work?
There’s no cost to use PerPay. PerPay won’t check your credit when you apply to use it and instead gives you a spending limit based on your income. You split your purchase up into a number of payments, and you get to choose the number of payments.
To qualify for PerPay, you must meet the following requirements:
Actively maintain full-time employmentHave three months of continuous employment with your current employerGet paid through direct depositOwn a working mobile phoneHave no current bankruptcies Be in good standing for all financial obligations
You aren’t eligible to use PerPay if you’re an independent contractor, gig-economy worker, or are self-employed.
Your purchase will not be shipped until your first payment is made, which is deducted from your next paycheck after ordering the item.
Pros and cons of PerPay
Pros
No credit check required. Your spending limit will be set based on your income, and PerPay won’t look at your credit when you make a purchase through the company. Choose the number of payments you want to make. Payments are automatically deducted from each paycheck after you order the item, and you can split the payments up into as many installments as you wany.Doesn’t charge interest on purchases. You won’t pay any interest to use PerPay’s services. No fees. PerPay doesn’t charge fees for late or missing payments. Easy to shop on the mobile app. PerPay’s mobile app is well reviewed on both the Google Play and Apple stores. You’re able to manage your payments from the app as well as browse products from different companies.Build credit with PerPay+. You need to sign up for PerPay+ to have your payments reported to the three major credit bureaus (Experian, Equifax, and TransUnion). The add-on allows you to build credit on your purchases. PerPay+ is designed to help you improve your credit score — as long as you make on-time, reliable payments.
Cons
Item isn’t shipped until after your first payment. This happens after your next paycheck following your purchase, so the item could be delayed by a couple of weeks. This may hurt you if you need it more promptly. Can only buy items on PerPay’s marketplace. While other BNPL companies allow you to use their service to shop on retailer’s sites or in their in-person locations, you can only use PerPay to buy items on its site or app. Must pay through automatic deductions from your paycheck. PerPay’s payment structure requires you to pay off your purchase over the course of a predetermined number of paychecks.
Who is PerPay best for?
PerPay is best for borrowers who want more repayment flexibility than a standard buy now, pay later, “pay in four” option. With PerPay, you choose how many payments you want to make over time, and those payments are deducted automatically from your paycheck.
Be careful. Buy now, pay later programs might entice you to buy something you may not realistically be able to afford. Just because the payments from each paycheck look small doesn’t mean the total cost isn’t still significant. Make sure you’ve made room in your budget for the item before making your purchase.
How PerPay compares to other buy now, pay later apps
PerPay
Afterpay
Affirm
Payment plans offered
Split over a series of automatic payments from your paychecks until item is paid in full
Payment plans offered
Split over four interest-free payments
Payment plans offered
Split over four interest-free payments, six months with interest, or 12 months with interest
Late payment fee
None
Late payment fee
$8 if you miss a payment by 10 days or more
Late payment fee
None
PerPay buy now, pay later
Afterpay buy now pay later
Affirm
Of PerPay, Affirm, and Afterpay, only Afterpay charges late fees. Late fees may add to the total cost of your borrowing, so set up a proper budget to make sure you don’t fall behind.
PerPay doesn’t have a set number of payments until you pay off your purchase, but instead takes an amount from each paycheck until you pay off your purchase. The other two companies offer a “pay in four” option, meaning you pay for your item over four installments.
Additionally, each company has thousands of companies they have partnered with, making buy now, pay later accessible for many different types of purchases.
How trustworthy is PerPay?
PerPay has an A+ rating from the Better Business Bureau, a non-profit organization focused on consumer protection and trust. The BBB evaluates companies by looking at their responses to customer complaints, honesty in advertising, and truthfulness about business practices.
PerPay hasn’t been involved in any recent controversies.
Still, a top-notch BBB rating and a clean history doesn’t guarantee you’ll have a good relationship with the lender — make sure you ask your friends and family about their experiences before using the product.
Frequently asked questions
Does PerPay report to credit bureaus?
You need to sign up for PerPay+ to have your payments reported to the three major credit bureaus (Experian, Equifax, and TransUnion). The add-on allows you to build credit on your purchases after completing four months of on-time payments exceeding $200.
PerPay+ is designed to help you improve your credit score — as long as you make on-time, reliable payments. PerPay+ costs $2 per month, though it’s free while you aren’t actively paying down an order.
If you don’t activate PerPay+, your payments won’t be reported to credit bureaus.
Is PerPay legitimate?
Yes, PerPay is a legitimate company that allows you to spread out the cost of a purchase over a series of automatic payments from your paycheck.
What happens if you don’t pay PerPay?
In PerPay’s terms and conditions, the company states that you have no legal obligation to continue making payments if you lose your job, have a medical emergency, or face other unexpected financial challenges. PerPay only asks to “do your best to resume payments when you can.” PerPay won’t charge you any fees for missing or late payments.
In a word, pretty much nothing will happen if you don’t pay PerPay. However, you won’t be able to make any additional purchases while a payment remains due, and if you’re signed up for PerPay+, your missed payments may be reported to credit agencies.