What You Need to Know About Apple Pay Later


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Apple recently introduced a payment service called Apple Pay Later, which is available to Apple users in the United States. Users can split eligible online and in-app purchases into four equal payments spread over six weeks with no interest charges. This loan service could make for an excellent way to spread out the cost of a purchase without paying credit card interest.

What to expect with Apple Pay Later

As buy now, pay later (BNPL) loans become increasingly popular, more and more installment loan offerings are available to consumers. Apple recently announced its new Apple Pay Later service, which will allow users to split up larger payments without being charged interest. Apple users can apply for loans of $50 to $1,000 through Apple Wallet.

Apple Pay Later can be used for in-app and online purchases made on iPhone and iPad with merchants that accept Apple Pay. Eligible purchases can be split into four equal installments. Users will have six weeks to pay off the loan without incurring interest. The first payment will be due right away and each additional payment will be due every two weeks.

When applying for a loan, Apple will perform a soft credit pull. This means the application will not impact your credit score. However, once a user accepts a loan, their actions could impact their credit. Users can manage and track their loans through Apple Wallet. To avoid additional debt, users are unable to pay back their loans using credit cards. Instead, they will be asked to link a debit card as their loan repayment method.

For now, Apple Pay Later loans are available to select users. However, loans will be made available to all eligible users later. If you need help affording a purchase without using a credit card, an Apple Pay Later could work well for you. But make sure you’re able to commit to the installment plan so you successfully pay your debt off within the six week timeline.

More tips to manage your spending with BNPL

With more BNPL loan options available, it can be tempting to use these services. While these loans offer convenience, you should be aware of the dangers of BNPL. These tips may help you avoid taking on too many loans, which could negatively impact your personal finances:

Set and follow a budget. You want to make sure that you’re able to afford any loans you take on. It’s a good idea to set and follow a budget so you’re not overspending beyond your means. Budgeting apps make it easier to track your spending.Pay attention to payment timelines and interest rates. Many BNPL providers offer 0% interest loans. It’s important that you make timely payments and pay your debt off before interest is charged. Otherwise, you may be required to pay additional fees.Set up automatic payments. If you’re forgetful, it’s a good idea to enable automatic payments. When you do this, your payments will be made on time for you so you can avoid falling behind on payments and incurring late fees.

Apple Pay Later is another financial tool that may help consumers finance purchases. But make sure that you consider your budget and understand the terms and conditions of a BNPL loan to avoid extra fees and financial worry. If you’re careful and can afford the payments, these loans can be a good financial tool.

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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Natasha Gabrielle has positions in Apple. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.