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What is BNPL? - Definition 


Buy Now Pay Later (BNPL) is a way of spreading out your payments when you buy something, it’s like an instalment plan. It is possible to ‘Buy Now Pay Later’ on a wide range of things these days, from small purchases in shops, to services such medical and vet bills, and much more expensive things like home renovations or solar panels.

When the purchase is made using BNPL, the provider you have an account with pays for it on your behalf. You then repay the BNPL provider over a set length of time, in instalments.

Each BNPL provider has its own rules about how much you need to pay in each instalment, and how long you have to pay them for the whole amount.

You do not pay interest when you use BNPL. However, each BNPL provider has different rules on fees. You may be charged a fee for their service or if you are late in paying your instalment – so it is very important to read the terms and conditions before you sign up and keep an eye on when payments are due.

If you see this 'tick' (see below), the BNPL provider is a member of the AFIA Code of Practice. BNPL providers that are signed up to the Code of Practice make nine commitments, or promises, to you about how they will treat you as a customer.

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