With so many Buy Now Pay Later (BNPL) providers, what\u2019s another one on the list?<\/p>\n\n\n\n
No credit checks, no interest, and instant approval \u2014 that\u2019s Zip\u2019s promise to you. But does Zip deliver on its promises?<\/p>\n\n\n\n
In this guide, we\u2019ll help you answer that question while looking at how Zip allows you to pay later.<\/p>\n\n\n\n
Let\u2019s start with the basics first.<\/p>\n\n\n\n
Zip is a BNPL platform with a list of over 80,000 global merchant partners. Previously known as Quadpay, the company is headquartered in Sydney, Australia.<\/p>\n\n\n\n
Zip offers users financing options through its app which is available for download on the Google Play Store and the Apple App Store.<\/p>\n\n\n\n
To help you better understand how Zip works and if it\u2019s the right product for you, we take a closer look at Zip\u2019s BNPL service starting with its application process.<\/p>\n\n\n\n
The process starts when you sign up for a Zip account or select the Zip payment option upon checkout. Sign-up can be done through the app while checkout can be done in-store or online. You can also add its Chrome extension to your computer and make shopping online with Zip easier.<\/p>\n\n\n\n
If you\u2019re downloading the app, you must first create an account and set a password. Then, you can browse the list of stores and add the products you want to your cart. Once you\u2019ve confirmed the amount, Zip auto-fills your payment details, and you\u2019re done.<\/p>\n\n\n\n
If you\u2019re shopping in-store, you can directly open the app and go to the in-store tab during checkout. You will then have to enter the purchase amount. Zip will generate a virtual card that you can add to your Apple Wallet or Google Pay. You can now use your virtual card to complete the purchase.<\/p>\n\n\n\n
Zip runs soft credit checks at the time of order placement. This is done almost instantly.<\/p>\n\n\n\n
The platform processes every order through an automated system. Orders are reviewed individually at the time they\u2019re placed. This means that if you don\u2019t have enough available balance, your order might get declined.<\/p>\n\n\n\n
Zip is currently only available to users who reside in the United States and are at least 18 years old. Here are other requirements to qualify for its services:<\/p>\n\n\n\n
Zip requires you to submit a list of documents to verify your identity and the above-mentioned details.<\/p>\n\n\n\n
Zip doesn\u2019t give you a common credit\/spending limit since each order is assessed separately. Your spending limit is based on your repayments and for how long you\u2019ve been using Zip.<\/p>\n\n\n\n
However, a minimum purchase limit of $35 is required to use Zip as a financing option.<\/p>\n\n\n\n
Zip\u2019s unique offering is its installment plan. It divides your total purchase into 4 equal installments that you need to pay for over 6 weeks.<\/p>\n\n\n\n
The first installment is paid upon checkout. The remaining 3 installments are paid every 2 weeks over a total 6-week period. If you fail to pay the first installment, your order will be declined.<\/p>\n\n\n\n
More expensive purchases might need a higher initial payment. This can be off-putting for some users who are looking for lighter payment options.<\/p>\n\n\n\n
Though the app allows you to remit installment payments earlier than their due dates through the \u201cOrders\u201d section, it requires you to pay each installment one at a time.<\/p>\n\n\n\n
Zip charges an annual percentage rate (APR) based on the creditworthiness of the consumer. The fee is 4% for every purchase and is charged separately from the installments. This means that each installment payment has a 1% APR charge.<\/p>\n\n\n\n
Zip charges you $4 for every purchase and a late fee for missed installments. There are no other hidden fees.<\/p>\n\n\n\n
The late fee often changes based on the statute and the state you\u2019re in but usually varies from $5, $7, and $10.<\/p>\n\n\n\n
Since Zip installments are automatically collected from your default card account based on when each installment is due, missed payments can only happen if you don\u2019t have enough funds in your account.<\/p>\n\n\n\n
To keep this from happening, you can use a secondary card as a backup and add it as a backup payment option. Installments that get declined on the default card are automatically redirected to the secondary card.<\/p>\n\n\n\n
Yes. Zip runs a soft credit check every time a purchase is made. Since it isn\u2019t a hard check, Zip\u2019s credit check doesn\u2019t affect your credit score.<\/p>\n\n<\/div>\n<\/div>\n
Zip has an ever-growing list of retailers across five continents. Some of its popular merchants include:
1. Famous Footwear
2. Fashion Nova
3. Walmart
4. Target
5. Apple
6. Best Buy
7. GameStop
8. Newegg
9. eBay
10. Amazon
11. Macy\u2019s
12. Shein
13. Zara
14. Poshmark<\/p>\n\n<\/div>\n<\/div>\n
Paying off installments doesn\u2019t affect your credit score, however, Zip sends users with multiple missed payments to collections. Being sent to collections will negatively reflect on your credit score.<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n
Now that we\u2019re familiar with how Zip works, let\u2019s have a quick review of its pros and cons.<\/p>\n\n\n\n