PayPal’s Pay in 4 and Pay Monthly plans let you divide the cost of a purchase into smaller installments with no fees.
3.5
NerdWallet Rating
$30 - $10K
35.99%
None
No fees
Pay in 4, Pay Monthly
PayPal Pay Later is the name for PayPal’s “buy now, pay later” payment plans, which help you spread out the cost of your purchase over weeks or months.
PayPal Pay in 4 lets you split up a purchase over six weeks with no interest, while PayPal Pay Monthly comes with terms up to two years and charges interest. There are no fees for either plan.
» COMPARE: The best buy now, pay later apps in 2025
What the nerds think
“PayPal’s big drawback is that it doesn't have the same flexibility as other BNPL apps. For example, its Pay in 4 is only available for online purchase, and you can’t reschedule a payment or turn off autopay. But if you’re not too worried about these features, PayPal Pay in 4 isn’t a bad option, since there’s no interest or fees.”
PayPal Pay Later works by dividing the total cost of your purchase into smaller installments when you check out in the PayPal mobile app or at a store that partners with PayPal. There may be two payment plans to choose from: PayPal Pay in 4 and PayPal Pay Monthly.
If you go with Pay in 4, you’ll need to make the first installment at checkout. You’ll then be automatically enrolled in autopay, and can use a debit card, credit card or bank account for repayments.
If you choose monthly financing, you owe nothing at checkout and can use only a debit card or bank account for repayments. You can disable autopay for Pay Monthly, but not for Pay in 4.
There's no penalty for making an early payment or paying off your Pay Later balance in full before the due date. PayPal doesn’t charge any fees, including no late fees.
PayPal 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
PayPal may conduct a soft credit pull when you apply for a Pay Later loan. This doesn't affect your credit score, and there is no minimum credit score requirement to use PayPal Pay Later.
To be eligible for PayPal Pay Later, you’ll need to be at least 18 years old. You must also have a PayPal account in good standing or be willing to open a PayPal account to apply.
Pay in 4 isn't available if you live in Missouri, and Pay Monthly isn’t available if you live in Alaska, Connecticut, Hawaii or Washington.
Approval decisions are instantaneous and may depend on a few factors, like information from the credit bureaus and any past usage or history with PayPal.
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.
PayPal’s Pay in 4 is similar to the pay-in-four plan offered by Affirm, which comes with zero interest and no fees. Like PayPal, Affirm also offers monthly financing, but with the possibility of zero interest.
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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.
There’s no minimum credit score requirement to use PayPal Pay Later, which is standard for BNPL providers.
No, PayPal doesn’t approve everyone. Each Pay in 4 or Pay Monthly purchase is an individual loan decision, meaning you may be approved for one purchase but not another.
Applying for a Pay Later loan won’t hurt your credit. Missing payments on your loan – especially if those payments become 120 days past due – could be reported to credit bureaus and hurt your score.
The downsides of PayPal Pay Later are you may be tempted to overspend, and your credit score may suffer if you fall behind on payments. You won’t be charged any fees.
PayPal Pay Later doesn’t cost anything if you choose Pay in 4. If you choose Pay Monthly, you’ll pay interest.
3.5
NerdWallet Rating
