The countdown for Flipkart's Big Billion Days (September 23-30) and Amazon's Great Indian Festival (From September 23 onwards) has begun with netizens waiting to indulge in a shopping extravaganza. Splurging on mobile phones, clothes and other electronic gadgets is no longer an issue of affordability given the ease of access to credit via various financial instruments. Among these, a lot of online shoppers are seen flocking to Buy Now Pay Later (BNPL) options these days.
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A short-term financing system, BNPL lets users to make purchases and pay for them at a future date, often interest-free. The big downside is that late payment can severely dent one's credit score.
How does BNPL work?
Once the lender pays on your behalf, you will have to repay the amount within a set time period. It can be paid as either a lump sum or as no-cost Equated Monthly Installments (EMIs). The failure to pay means a borrower will be liable to pay penalties and impact your credit score.
Different platforms offering BNPL
There are several players offering BNPL services in India. However, before using them this festive season you know about their terms and conditions.
Simpl
Simpl, a short-ticket mobile-first lending platform, gives you a credit where the spending limit is initially set by default. But once you start using Simpl, the limit is constantly updated based on a few major factors — like how regularly you repay and your spending habits.
It lets you add all bills into one, which you can pay in one go.
Simpl charges a penalty of up to Rs 250 excluding GST in case of consistent non-payment of the bill on due dates. However, if you inform Simpl of any issues, no charges will be levied depending on the situation.
The Simpl bill is generated twice a month. All your transactions between the 1st and 15th are added to one bill, which is generated on the 15th. All transactions made between the 16th and the 30th/31st are added to one bill.
LazyPay
LazyPay is a payment service that also lets users get credit online. Customers are required to enter their mobile numbers and discover their unique credit limit. It claims to offer an interest-free credit period of up to 15 days.
If you have done your KYC and got access to features like part payment of bills and higher credit limit, the penalty structure is based on your credit usage. There are 2 penalty charges -
Late fee charges: Depending on your bill amount, you will be charged 4 percent of your bills or Rs 250, whichever is higher (GST of 18 percent will be applied). A late fee is applied once a month if you default. In case you make a part payment before the due date, late fees will not be applied.
Interest charges: You will also be charged an overdue interest charge of 3.5 percent of your bill amount.
If you have set up auto-pay and you do not have sufficient bank balance at the time of auto-pay, they a bounce charge of Rs 300.
If you do not have access to partial repayment, you will be charged a late fee of Rs. 17.7 (inc. 18 percent GST) per day after the due date till you repay. This means if your bill is due on the 3rd of the month, you will be charged late fees from the 4th and if your due date is on the 18th, you will be charged from the 19th of the month till you repay.
ZestMoney
This is a buy now pay later platform that has partnered with more than 3,000 leading e-commerce websites. Here are some of them:
| MakeMyTrip | Flipkart |
| Amazon | Boat |
| Myntra | MI |
| Decathlon | Curefit |
| Royal Sundaram General Insurance | Simplilearn |
| Uber | Titan |
| Bombay Shaving Company | Sleepy Head |
| Revv | Kurl On |
(Source: Bankbazaar)
In case of delayed payments, a flat fee of Rs 250 per EMI is charged.
Paytm postpaid
This is a pre-approved and instant credit for select customers of Paytm. It can be only used to make online/offline rupee-denominated purchases from select merchant websites or outlets which are enabled to receive payments by using the Paytm platform.
All Paytm postpaid users are billed on a monthly basis for all purchases made using this. The statement of account is available on the Paytm platform on the 1st of every month for the transactions made during the preceding month and also on email if the email is updated on the Paytm platform.
These are the charges levied by Paytm Postpaid in case of payment default:
| Outstanding Amount | Late Fees(per month) |
| Upto Rs. 100 | Rs. 0 |
| Rs. 101 to Rs. 250 | Rs. 10 |
| Rs. 251 to Rs. 500 | Rs. 25 |
| Rs. 501 to Rs. 1000 | Rs. 50 |
| Rs. 1001 to Rs. 2000 | Rs. 100 |
| Rs. 2001 to Rs. 5000 | Rs. 250 |
Amazon Pay Later
Amazon Pay Later is the way to get instant credit, via a completely digital process, for purchases using EMI on the Amazon website.
Using this, users can pay later next month or over EMIs ranging from 3 to 12 months. They can track purchases, repayments, and limits history from a dashboard for this payment mode.
Here are the late payment charges:
| Payment amount | Late charges |
| <= Rs 200 0 | 0 |
| >200 <= Rs 1,000 | 100 + 18% GST |
| >1,000 but <=5,000 | 200 + 18% GST |
| >1,000 but <=5,000 | 200 + 18% GST |
| >1,000 but <=5,000 | 200 + 18% GST |
Flipkart Pay Later
Flipkart Pay Later lets users buy products, experience using them, and then pay for them before the 5th of the next month with zero additional charges. With this, one can bunch up payments and clear them all at once.
The penalty structure is as follows:
| Bill Amount | Late Payment Charge Amount |
| Rs 100 - Rs 500 | Rs 60 |
| Rs 501 - Rs 1000 | Rs 125 |
| Rs 1001 - Rs 2000 | Rs 175 |
| Rs 2001 - Rs 4000 | Rs 300 |
| Rs 4001 - Rs 5000 | Rs 410 |
| Rs 5000 & above | Rs 600 |
(Edited by : Ajay Vaishnav)
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