This blog title may sound familiar as it is another ‘Buy Now Pay Later’ Credit scheme; No, we haven’t written about ZipPay before, but we have written about its sister AfterPay and whether or not the ‘modern day lay-by’ is helpful or harmful. What did we decide? Read the blog to find out.
And what do we think about ZipPay? Is it the same or are there differences? Let’s take a look.
What is ZipPay?
Similar to AfterPay, ZipPay is a digital service, fully integrated with all your favourite shops, allowing you to shop as usual, and choose ZipPay as your payment method.
ZipPay allows you to ‘Own the way you pay at your favourite stores’ and offers credit of $250, $500 or $1000 that can be spent at participating retailers. Shoppers can make repayments either weekly, fortnightly or monthly, as long as a minimum repayment of $40 is made each month.
Where can you use ZipPay?
A growing number of stores are adding ZipPay to their list of accepted payment methods. By the end of last year, ZipPay was used by more 530,000 shoppers to make $230 million in purchases from 7,700 merchants across Australia.
Do you need to apply for ZipPay?
Yes. One of the major differences between AfterPay and ZipPay is that you need to apply before you can buy.
The online application and approval process is fast as it authenticates many of your personal details by linking with your Facebook and PayPal accounts. Don’t feel comfortable sharing all this information with yet another financial institution? We don’t blame you!
ZipPay conduct formal ID and credit checks to decide whether your limit will be $250, $500 or $1000.
It’s important to know that this process affects your credit rating too. Here’s what their terms and conditions say:
- When you apply –“When creating an account, we may perform identity and/or credit checks to verify the customer and their ability to manage payments.”
- If you default – Payment defaults will be reported to a relevant Credit Reporting Body.
Can you trust ZipPay and is there a catch?
For every month there’s a balance owing you’re hit with a $6 fee. Fail to cover that payment within three weeks, and you’re charged another $5. If you were to miss all of your repayments on a $100 pair of jeans, for instance, you would have to spend an extra $33 on fees… Would you have bought the $100 jeans if you knew beforehand that it might cost you $133?
ZipPay’s repayments are set to direct debit by default, which is why it’s best to make sure there’s enough money in your account to stop it from being overdrawn to avoid bank fees. They don’t do it for nothing either. They charge customers fees and retailers a percentage every time a sale is processed on its platform, helping them make money in two very easy ways.
Saving up before a purchase is still the best way to go. But, if you’re still inclined to sign up with ZipPay, make sure you budget to make all of your repayments and not be hit with fees … and happy shopping!
What do we say about ZipPay? The same thing we say about AfterPay and any other “interest-free payment provider” … Buyers beware and buy with care. #caveatemptor
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