- Afterpay is one of the biggest and most successful buy now pay later services.
- Offers installment loans — repaid in four payments — at a huge range of stores.
- Find out everything you need to know about how it works in our review.
After launching in Australia, Afterpay exploded in popularity and quickly expanded into other markets, including Canada. They have been a pioneer in the buy now pay later space, displacing the role of the credit card in many wallets.
They offer plain and simple installment plans, available at the point of sale and with no credit check required. As such, Afterpay have a cult-like following among millennial and zoomer generations.
If you are considering signing up for Afterpay but don't know if it is for you, this review will cover everything from late fees to credit checks.
Inside this review
What is Afterpay Canada?
Afterpay is a premier buy now pay later service, allowing you to make purchases on credit without using your credit card or a traditional lender like the bank.
Founded in 2015, this Australian fintech has headquarters in Sydney. Afterpay caters to consumers in its home market of Australia, as well as those in Canada, America, New Zealand, and the UK.
With Afterpay, you make your first installment at the retailer's point-of-sale, and then you make a further three payments, each for 25% of the total purchase price, every two weeks.
How it works
Afterpay makes it easy to buy now and pay later on a variety of online and offline purchases. You'll open an account with the company and use your credit facility to pay for your point-of-sale purchase.
Afterpay lets you split your repayments into four payment dates, paid fortnightly. The facility allows consumers to shop now and pay later, breaking up expensive purchases into affordable chunks.
To qualify for using Afterpay, your purchase must be over $35. You'll need to be 18 years old to open an account, and you need a credit or debit card to link to your Afterpay account.
When opening your account, Afterpay requests your name, email address, and phone number. Afterpay doesn't require your SIN when signing up for an account.
How much does it cost?
Afterpay Canada offers you interest-free loans with no APR or interest and no hidden charges. As long as you pay on time, you'll never have to pay any excess charges on your account.
However, if you do think there's a chance you're going to miss a payment, you get one free opportunity to change your payment date. If you miss a payment, Afterpay will stop you from being able to make any new purchases.
What stores accept Afterpay?
In mid-2019, Afterpay crossed the milestone of more than 1.5 million users in the US alone and has over 13 million users worldwide. The company has partnerships with some of the world's largest retailers, with over 65,000 online and offline vendors accepting Afterpay at checkout.
You can use Afterpay facilities at top retailers like Adidas, Ulta Beauty, UGG, CAT Workwear, Cotton On, Nike, and many more.
Does Afterpay affect your credit score?
When you sign up for an Afterpay account, the company runs a "soft" credit check. The company doesn't run a "hard" credit inquiry when you open an account, so opening an account won't affect your credit score.
However, Afterpay doesn't send any of your payment information to the credit bureaus either, except if you miss a payment or default. Therefore, you don't get any benefit to your credit score by paying off your loan in a timely manner.
If you're looking to improve your credit score or build a payment history, you'll need to use a POS lender like Affirm or use your credit card instead.
Pros and cons
- Fast, easy approval.
- No "hard" credit check to negatively affect your credit score.
- Multiple accounts available.
- No upfront fees or interest charged on your outstanding balance.
- $1,500 limit on purchases.
- You might not receive the full limit on your first loan facility.
- Your payments are not reported to a credit bureau.
- No flexible payment options.
- Sezzle: Headquartered in Minneapolis, this popular buy now pay later fintech services the US and Canadian markets. Sezzle offers users loan facilities of up to $2,500. However, you might not qualify for the total loan amount on your first loan using Sezzle.
- PayBright: Canada's leading point-of-sale lender, acquired by Affirm in 2021, the leader in buy now pay later services. As a result, Affirm gives you access to POS loans at over 7,500 partner retailers in the US, Canada, and internationally.
- Affirm: A global leader in buy now pay later point-of-sale loans, Affirm is available at online and offline retailers. The company recently acquired PayBright.
What is the credit limit for Afterpay accounts?
Afterpay offers you a maximum credit limit on a single purchase of up to $1,500. You can take multiple loans, but the total outstanding balance for all loans cannot exceed $2,000 on your account. The Afterpay team manages your account to ensure you stay within these limits.
What happens if you don't pay Afterpay?
Afterpay requires you to meet your contractual obligations for repaying your account. If you miss a payment or pay late, Afterpay will stop you from making further purchases but there aren't any late fees.
Can you have more than one Afterpay account in the same name?
Yes, Afterpay lets you sign up for multiple accounts under the same name. The Afterpay team manages your account, ensuring you don't exceed the maximum loan limit of $1,500 per account and a maximum rolling limit of $2,000 for all your accounts.
Can you use Afterpay for utility bills?
Yes, you can use Afterpay to pay other bills like your water and lights. Log into your Afterpay account, and select the invoice you wish to pay in installments. Afterpay offers you several payment methods. In addition to utility bills, you can take a loan for paying your car servicing or a variety of other bills.
How old do you need to be to sign up for an Afterpay account?
Afterpay involves you signing legal loan agreements for your point-of-sale purchase. Therefore, you need to be at least 18 years old to open an Afterpay account and use the service. If you're under 18, you don't qualify for using Afterpay.