Financial responsibility looks vastly different than it did decades ago.
Instead of saving up to purchase that next big item, consumers have turned to borrowing.
Historically, they have relied on credit cards; however, the hefty fees associated with credit cards have made them a thing of the past.
Instead, companies like Zilch are providing consumers with a financially responsible avenue to buy now, pay later — or BNPL — platforms.
With Zilch, users can split their payments into 4 over 6 weeks with 0 interest at thousands of participating stores.
If they want to shop elsewhere, they can still buy, now pay later with Zilch Anywhere. This option allows them to pay 25% of the total price together with a transaction fee upfront, then pay the rest in 3 more instalments over 6 weeks*.
Zilch users also have the option to pay in full and get 2% cashback in Zilch Rewards, which they can use to discount future purchases.
What Is BNPL?
Buy now, pay later is a payment method replacing traditional and department store credit cards. Most BNPL providers offer consumers instant — typically interest-free — loans for their shopping experiences.
Usually available as a service both online and in-store, BNPL allows consumers to spread their payments over time. They must simply put down a percentage of the cost and then pay the rest later.
Unlike those of most traditional credit cards, payments are split into instalments, allowing customers to complete their payoff in an appropriate amount of time with no interest or extra fees for most BNPL providers.
For example, say it’s the holiday season, and someone wants to buy their friends and family gifts.
Using BNPL, they can purchase the gifts in December and make payments in the following weeks to cover the expenses.
Benefits of BNPL to Shoppers
Since its introduction, buy now, pay later has provided numerous benefits to consumers — specifically those selecting BNPL over traditional borrowing. Here are a few ways BNPL is helping consumers save.
Avoid high-interest rates.
In 2021, the average credit card interest rate is 18.24% for new offers and 14.54% for existing accounts, according to WalletHub’s Credit Card Landscape Report.
These astronomically high interest rates can make it nearly impossible to pay off debt.
However, BNPL services offer consumers the ability to purchase with no interest or lower interest rates than most credit cards.
For example, Zilch gives users the option to pay in 4 over 6 weeks at thousands of participating stores with 0 interest. This means that consumers can shop with the understanding of the final amount they will pay for their products and services.
Buy Now, Pay Later: Empowering Users
Consumers need options today, and BNPL offers them options in terms of choosing how, when and where they want to pay, as well as using other features that could potentially help them be more in control of their finances.
BNPL can be utilized as a budgeting tool.
Some BNPL platforms act as a budgeting tool for today’s consumers. Users can leverage the app to manage their purchases and make payments on time.
Those who use the service to buy now, pay later can use the app to make the purchase responsibly.
BNPL lets consumers pay at a pace that suits them.
The ability to pay over time — in three, four or more instalments is something that BNPL brings to the table for users. With Zilch, there is the option to pay in 4 or pay in full to get 2% cashback in Zilch Rewards, allowing them to choose the payment method that best suits them.
How It Works: An Explanation of a Zilch BNPL Transaction
Buy now, pay later platforms can vary in how the plan works. Here’s a snapshot of how Zilch works:
-Download the Zilch app.
-For online purchases, search the store you want to shop using the Zilch app. When you select it, under ‘Pay in 4’, you will see if there’s a corresponding transaction fee or not.
-If the store you want to shop at does not appear when you search for it, select Zilch Anywhere. This option will still allow you to ‘Pay in 4’ with a corresponding one-off transaction fee taken together with your first instalment.
-Click on the store to start shopping if you agree to the transaction fee.
-After shopping is complete, check out using your Zilch card.
-Pay 25% upfront, and the rest in three instalment payments over six weeks.
-For brick-and-mortar shopping, you can simply tap and pay anywhere you see the Mastercard logo.
Once your purchase is complete, and you have paid the initial 25%, you will pay the rest in three instalments:
-2nd Payment: 25% payment after two weeks from the initial purchase (total paid: 50%)
-3rd Payment: 25% payment after four weeks from the initial purchase (total paid: 75%)
-4th Payment: 25% payment after six weeks from the initial purchase (total paid: 100%)
If you need additional time for a payment, you can tap “snooze,” and Zilch will offer you four more days to complete the payment. This feature can be unlocked for some users and usage may incur a fee.
Additionally, Zilch offers users the following perks:
-All purchases and payments can be managed through the Zilch app.
-Pay 100% up front and receive 2% cashback in Zilch Rewards.
-Receive £10 in Zilch Rewards when you refer a friend.
-Receive alerts before instalment payments are due.
-Access simple refunds! Once the store accepts the return, your refund will be processed and you’ll get a notification when the refund has been completed.
-Ongoing safety and security: Mastercard powers the Zilch app, so it’s as safe as using your debit card.
Zilch has gained popularity since its introduction, and today, numerous other apps leverage their BNPL service to help consumers meet specific financial requirements.
For example, Zilch can be used with Uber, eBay and Amazon, allowing the customer to get the products and services they want or need on demand while managing payments over a set period of time.
Furthermore, you can make purchases across numerous industries, including fashion, home, electronics, health and well-being, as well as experiences, like exhibitions, theatre performances, salon or spa visits, pop-ups and more.
With Zilch, there are options aplenty and the choice is yours.
*Spend responsibly, spending more than you can afford could seriously affect your financial status. Credit subject to status, 18+, UK residents only. Representative APR 18.1% (fixed). Rep Example: based on total spend: £240 (+ £2.50 transaction fee). Total repayable: £242.50 paid over 6 weeks, 1st payment £62.50, then 3 payments of £60.00 every 2 weeks. T&Cs apply.