BNPL card or credit card, what is better, know here


new Delhi- The policy of ‘Buy Now Pay Later’ is spreading fast in the country. On the festive season, many companies are offering Buy Now Pay Later facility to attract more and more customers towards them. This facility is a kind of small loan and its trend is increasing rapidly.

Like a credit card, ‘Buy Now, Pay Later’ (BNPL-BNPL) allows people to make purchases and pay in easy installments. Both the options also offer interest free repayment window.

Often the question comes that when we are getting the facility of buying the same and later payment by credit card, then what is the benefit of BNPL system or what is the need of credit card due to BNPL system?

Buy Now Pay Later
Customers in India are using Buy Now Pay Later Installment plans for purchases. Uni and slice company have introduced BNPL cards with Buy Now Pay Later facility. These companies distribute the outstanding bill of BNPL card users in three equal interest free installments in three months.

Uni Card allows its users to pay a minimum amount at the end of the month and carry forward the balance. Nitin Gupta, Founder and CEO, Uni said, “We charge a carry forward charge of 3-4% on the balance from the billing cycle when the minimum due is paid.”

Whereas, credit cards charge interest on payment of the minimum amount due but credit cards charge interest on the balance. Slice does not offer minimum payable payment option.

high interest on credit card
Nitin Gupta says that in a card with pay later feature, if you are unable to pay the full amount by the end of three months, you can convert the due amount to Equated Monthly EMI for a longer period. But, for this a late fee has to be paid by default.

Most of the credit cards offer some reward on every transaction. These reward points keep on accumulating and can be redeemed in the form of air miles, gift vouchers, hotel bookings etc. after a certain number of points have been accumulated.

On the other hand, Uni provides 1% cashback to its users if the total due amount is paid by the end of the first month. Slice’s cashback plan works in the form of ‘Paisa’. With each transaction, users get an amount equal to the money spent. The amount collected can be transferred to cashback. For example, if a user has 1.5 lakh slices of money, they will convert it into Rs 1,500 cashback (1% of 1.5 lakh).

use abroad
The specialty of a credit card is that it can be used even when you are abroad. But you cannot use Buy Now Pay Later abroad. However, Buy Now Pay Later cards can be used to do some international transactions from India. Furthermore, BNPL cards offer first-time users a credit line starting at Rs 2,000, which keeps on increasing as per usage and payment behavior, while the credit limit on credit cards usually starts at Rs 20,000.

Tags: credit card, credit card limit, Online Shopping


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