Credit Score Basics > Who qualifies for BNPL (“Buy Now Pay Later”)?

Who qualifies for BNPL (“Buy Now Pay Later”)?

Wollit Team2 minute read · Updated 17th September 2024

Buy Now, Pay Later (BNPL) has become increasingly popular in the UK. It’s easy to see why: it offers everyone the ability to buy items and pay for them over time. However, not everyone may qualify for these services. Here’s how BNPL works and how to see if you can use it.

What is "buy now, pay later" (BNPL)?

BNPL is a type of short-term loan that allows you to purchase items and pay for them in installments, often interest-free.

These services are usually offered at the “point of sale”, meaning when you pay, either online or in-store, and are becoming increasingly popular.

How does BNPL work in the UK?

In the UK, BNPL services are usually offered by third-party providers, such as Klarna or Clearpay.

When making a purchase, you can choose to pay using a BNPL option, which will then split the cost into smaller, manageable installments.

These installments are usually due every two weeks or every month, depending on the provider and the amount you spent.

Who qualifies for BNPL in the UK?

To qualify for BNPL in the UK, you usually need to meet the following criteria:

At least 18 years old.
UK resident with a valid UK address.
You must have a valid debit or credit card to make your BNPL payments.

Finally, while some BNPL providers may perform soft credit checks to assess eligibility, others may not require a credit check at all. Because of this, sometimes people with a poor credit history may be less likely to qualify for larger purchase amounts or may have to accept lower spending limits.

What alternatives do I have to BNPL?

First of all, while BNPL can be a convenient way to purchase items and pay for them over time, they also come with serious risks:

BNPL can make it easy to overspend, as consumers may be tempted to make purchases they can't afford.
Missed or late payments can result in fees and can also sometimes hurt your credit score.
BNPL is currently less regulated than traditional forms of credit in the UK, which means you may not have the same protections (for example, if you want to return something).

A better solution is a credit card, since you can pay for your purchases over a longer period of time and earn rewards for doing so.

However, most credit cards come with similar requirements, especially when it comes to your credit history.

This is why it’s important to build your credit history so you can become eligible for better payment methods.

One of the ways to improve your score is to download a credit-building app like Wollit.

Wollit works by reporting a fixed fee monthly subscription as a loan repayment to the credit reference agencies (Experian, Equifax, and TransUnion). This helps you build or rebuild your credit history by showing that you can pay debt on time. It can even report your monthly rent payment to Experian, adding another line in your credit report that shows lenders you're responsible and pay your bills when they’re due. In time, this will help you improve your credit score so you can become eligible not only for BNPL, but also for credit cards with excellent rewards, and even generous personal loans or low rate mortgages.