Afterpay divides your purchase into four equal installments with zero interest, but it charges a late fee for missed payments.
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$20K
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Late fee
Pay in 4, Pay Monthly
Afterpay is a “buy now, pay later” provider that offers payment plans for online and in-store purchases.
Afterpay Pay in 4 comes with no interest and no fees if you pay on time, though it charges a late fee for missed payments. It also offers monthly plans for larger online purchases. These plans may charge interest.
» COMPARE: The best buy now, pay later apps in 2025
What the nerds think
“Afterpay is a solid option for BNPL shoppers. Its Pay in 4 product is always interest-free and there aren’t any random, one-off fees, which can’t be said for some of its competitors. It also has notable consumer-friendly features, like free payment rescheduling and automatic account pausing, both of which can help protect you if you’re unexpectedly short on cash. It does charge a late fee, though, so keep an eye on upcoming payment dates."
Afterpay works by dividing the total cost of your purchase into smaller installments when you check out with Afterpay online, in stores or in the Afterpay mobile app. There may be multiple payment plans to choose from, including Afterpay Pay in 4 and Afterpay monthly payments.
If you’re making an especially large purchase, it’s possible your first payment could be higher than the others, though Afterpay will show the plan’s full breakdown before you pay. Future payments are automatically billed to the debit or credit card you used to make the purchase, and some customers may have the option to link their checking account.
The autopay feature can help you avoid late fees, but you can also disable it for Pay in 4 if you’d prefer to make manual payments. Afterpay charges zero fees if you pay on time.
Afterpay is a safe and reputable provider of BNPL loans. However, NerdWallet doesn’t recommend using a BNPL loan to pay for a non-essential purchase, like recreational shopping. That’s because BNPL is still a form of debt, and it’s easy to get in over your head, especially if you struggle with overspending. Plus, if you fall behind on payments, your credit score could suffer, making it harder to qualify for affordable credit in the future.
» LEARN MORE: The pros and cons of BNPL
NerdWallet rates lenders against a rubric that changes each year based on how BNPL products evolve. Here’s what we prioritized this year:
» LEARN MORE: NerdWallet’s methodology for rating BNPL products
Afterpay may check your credit with a soft pull when you create an Afterpay account or sign up for a new Pay Monthly plan. This won’t hurt your credit score. Though there’s no minimum requirement, Afterpay considers your credit score as part of your application.
To be eligible for Afterpay, you must be at least 18 years old and a U.S. resident, and have a valid email address, mobile phone number, delivery address and payment method. To use Afterpay’s monthly plan, you may need to verify your identity (likely by providing a government-issued ID).
Approval decisions are instantaneous and depend on several factors, including whether there are sufficient funds available through your debit or credit card, how long you’ve been using Afterpay, the purchase price and whether you have other outstanding orders with Afterpay.
Nerdy Tip
One of the best ways to get approved for a BNPL loan is to show a history of on-time payments with that provider. Consider using BNPL to make a small purchase first, then pay off your loan on time or early. This may help you get approved for a slightly larger purchase in the future.
Afterpay doesn’t charge as many fees as other providers, like Klarna, Sezzle and Zip. But if you want a true no-fee BNPL loan, Affirm and PayPal may be the better choice.
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If you have good or excellent credit (any score in the mid-600s or higher), you may consider applying for a 0% APR credit card. These cards offer introductory periods of up to 21 months and charge no interest during that period. You may also receive a sign-up bonus or access to a rewards program.
Since your payment history is reported to the credit bureaus, it’s a reliable way to build credit. Make sure you pay off the purchase before the introductory period ends or you’ll owe interest on the remaining balance.
If you’re looking to fund a large, essential purchase, you could apply for a personal loan. Most personal loans start at $1,000 or $2,000, and there are options for borrowers with fair or bad credit (any score in the low 600s or below). Personal loans have fixed interest rates and longer repayment terms, both of which can help you budget for the monthly payments.
Personal loan lenders report your payment history to the credit bureaus, and they typically charge late fees.
Many lenders offer pre-qualification, so you can check whether you qualify for a small personal loan without hurting your credit score.
Afterpay is really interest-free if you sign up for Afterpay Pay in 4. If you choose Afterpay Pay Monthly, you may be charged interest.
The downsides of Afterpay are you may be tempted to overspend, since you don’t have to pay for your purchase all at once, and if you fall behind on payments, you’ll be charged a late fee.
Afterpay shouldn’t affect your credit since it doesn’t conduct hard credit pulls or report your payment history to the credit bureaus. However, Afterpay can sell overdue debts to a third-party collections agency, which would hurt your score, but this doesn’t appear to be common.
Afterpay requires a down payment for Pay in 4 and Pay Monthly purchases. For Pay in 4, it’ll be one-fourth of the purchase price. For Pay Monthly, it’ll be the first installment of your loan, which varies based on the loan term, loan amount and APR.
Yes, you can make early payments with Afterpay or pay off the loan entirely with no prepayment penalty or fee.
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