Shopping for Diwali? Here’s what works better between ‘Buy Now Pay Later’ option and credit cards

Shopping for Diwali? Here’s what works better between ‘Buy Now Pay Later’ option and credit cards

New Delhi: With Diwali around the corner, many people may make big festive purchases during the online sales that are flooded with discounts. Most of the online platforms have partnered with various banks, credit card companies, and digital payment wallets to offer discounts and cashback. Even though credit cards have always been one of the popular options among people, the Buy Now Pay Later (BNPL) service has also gained popularity in recent years.

They are betting on buy now, pay later as a way to reach younger consumers and keep up with the rapid shift to online shopping in the pandemic.


These services typically make money from merchants paying fees on purchases and late fees from customers if they miss a payment. If customers don’t pay up, the services, not the retailer, are left holding the bag.

With the buy now pay later system, you will be allowed to make purchases and accumulate your bills into one account. Thereafter, the consolidated bill is paid at one go fortnightly or monthly, depending on the BNPL service that you use.

Is ‘Buy Now Pay Later’ a better option than credit cards?

Credit cards charge a hefty percentage from borrowers if dues are not paid during the credit-free period, ranging from 36 to 42 per cent per annum. Usually with BNPL once the bill is generated, a grace period of 5 to 10 additional days are offered to the borrowers to clear their bill, and if the bill remains unpaid beyond that, a late fee of around Rs 250 to 300 is charged.

If a person wants to avail a credit card then in that case they need to fulfill some parameters which include your income, credit history, credit score, etc. because of which a lot of new to the industry borrowers fail to get eligible for a credit card. On the other hand, BNPL does not require to share their bank details or other financial details.

Additionally, while signing up a BNPL service does not attract any joining fee, whereas, in the case of a credit card there may be a sign up fee or a usage fee.

In terms of time, BNPL is a safer and swifter option for payment and, in the case of a credit card, borrowers may be asked to disclose bank account details and and OTP for authentication purposes.

The facility doesn’t have any hidden charges or maintenance fees.


Source:- timesnownews