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Sezzle vs Afterpay: Which is the Better Option?

By Kyle Kapper

Updated Sep 29, 2023

Sezzle vs Afterpay

    Buy Now, Pay Later” (BNPL) is a payment service that is gaining popularity in the e-commerce sphere. BNPL services offer shoppers the freedom to make purchases without paying the full amount upfront by breaking it down into manageable installments.

    Consumers are often presented with the enticing prospect of dividing their purchases into interest-free installments. Although Sezzle and Afterpay are two of the top BNPL platforms available today, when choosing between these two giants, the decision can be daunting.

    What is BNPL?

    Before we delve into the intricacies of comparing Sezzle vs Afterpay, we must understand the BNPL later concept. It is a payment plan allowing customers to make purchases and defer the payment to a later date. The concept of BNPL permits buying of products or services on credit, where the consumer can pay for them over a period of time in interest-free installments.

    This article will explore BNPL services and provide a comprehensive comparison of Sezzle and Afterpay, shedding light on their features, benefits, and potential drawbacks. We will help you determine which service aligns better with your shopping preferences and financial goals by delving into their respective mechanisms and user experiences.

    Benefits of Using Buy Now, Pay Later Services

    BNPL services are beneficial to consumers in numerous ways. For starters, BNPL allows you to conduct purchases without making the full payment all at once, making it easier to afford products and services you may not have enough money to pay for upfront.

    In addition, for a disciplined shopper with a consistent stream of income, BNPL is considered a zero risk option.

    Since BNPL gives you the luxury of time, you can plan for your money in a way that is comfortable and stress-free by avoiding lump-sum payments. This helps you avoid running into financial issues while on your purchasing journey.

    Some BNPL facilities offer interest-free periods, giving you a chance to pay off your purchases without incurring extra costs.

    Moreover, merchants get to enjoy a wider reach since many BNPL platforms do not run traditional credit checks, making them a popular option among consumers.

    As for the overall shopping experience, having the BNPL option in either a physical or online store leads to increased cart values and higher conversion rates for sellers, potentially providing more extensive product options for you as the consumer.

    And finally, compared to traditional credit cards, some BNPL platforms may offer lower or no fees for transactions, ranking them among the most cost-effective payment options available in the e-commerce industry.

    Limitations of the Buy Now, Pay Later Option

    Although BNPL is a great choice, it has a few limitations. For instance, it may encourage impulsive spending, leading to increased debt if you’re not careful with your purchases.

    Moreover, if you default on your installments, you risk being charged late fees and potentially damaging your credit score. Some BNPL providers may report missed or delayed payments to credit bureaus, affecting your credit history.

    Concerning security, BNPL offers less robust consumer protection compared to traditional credit cards or other payment options. Therefore, it is advisable to do your due diligence before selecting such services.

    On average, BNPL platforms do not charge interest on their services. However, in some instances such as when a buyer fails to pay an installment on time, they will incur high interest rates.

    Another limitation is the risk of overspending. Since it is easy to accumulate multiple BNPL agreements, it could potentially lead to debt problems if you struggle to manage your payments.

    You ought to be aware of any hidden fees associated with BNPL services, such as transaction fees or account maintenance charges.

    Lastly, you need to be cautious about sharing personal and financial information with BNPL providers, as customer data breaches and privacy concerns can arise.

    BNPL Summary

    Benefits of BNPLLimitations of BNPL
    Convenient payment optionPotential overspending
    Interest-free periodsLate fees for missed payments
    No credit checksImpact on credit scores
    Easy application processTemptation to make impulse purchases
    Flexibility in payment timingLimited merchant acceptance
    Transparency in costsPossible debt accumulation
    Budgeting assistancePotential dependency on BNPL

    What is Sezzle and How Does it Work?

    Sezzle is a BNPL platform where buyers make online or in-store purchases that they pay in four installments over a period of time.

    When shopping online or in person stores, you can select Sezzle as your preferred choice at checkout.

    Sezzle offers instant approval decisions, making it convenient for you to complete your purchases.

    The platform offers a “Sezzle Up” program, which rewards users for responsible spending and timely payments. In addition, customers who made timely payments while using Sezzle reported an average credit score increase of 20 points within the first four months of use.

    How it Works: Sezzle Payment Plan

    This payment method breaks down the cost of an item into four equal payments that you pay over six weeks. It is crucial to note that you will not incur any interest charges, but if you default on a payment, you will be charged a late fee.

    You pay the first installment upfront and the remaining payments are automatically deducted from your bank account every fortnight. Therefore, ensure you predetermine your cash flow before committing to this plan.

    What is Afterpay and How Does it Work?

    Afterpay offers BNPL facilities to buyers who prefer to break down their purchases into multiple installments. It is one of the popular options available during checkout both online and in-person.

    Afterpay usually provides instant approval, and there is no need for a credit report as long as you meet their eligibility criteria.

    As a retailer, offering Afterpay is beneficial to your business because shoppers who use this platform shop +50% more frequently than those who do not.

    How it Works: Afterpay Payment Plan

    This payment option divides the total purchase amount into four interest-free installments.

    The first payment is required immediately while the remaining ones are automatically deducted from your linked debit card or credit card every two weeks at no extra cost.

    Sezzle Vs Afterpay: A Comprehensive Comparison

    Although both Afterpay and Sezzle generally have similar features, they are not 100% the same. Let’s take a look at some of their similarities and differences.

    Sezzle Vs Afterpay: Similarities

    Some similarities between Sezzle and Afterpay include:

    • BNPL Model – Both Sezzle and Afterpay operate on a “buy now, pay later” model, offering customers the flexibility to pay for purchases in four interest-free installments over time.

    • Interest-Free Payments – Both facilities generally offer an interest-free payment plan, making them attractive to customers who want to avoid traditional credit card interest charges.

    • Easy Signup Process – Both Afterpay and Sezzle have user-friendly signup processes, enabling customers to quickly set up accounts and start using their services.

    • Online and In-Store Use – Both platforms can be used for online shopping as well as in-store purchases, providing a seamless payment option across various retailers.

    • Automatic Payments – Customers’ payments are automatically deducted from their linked bank account at regular intervals, making the payment process convenient.

    • Late Payment Fees – Both Sezzle and Afterpay charge late payment fees if customers default on their scheduled installments.

    Sezzle Vs Afterpay: Differences

    When we take a critical look at Sezzle vs Afterpay, we cannot deny the fact that both are great options. However, there are some major differences that influence customers to choose one platform over the other, including:

    Sezzle Vs Afterpay: Scope

    Being a platform based in the United States, Sezzle mainly operates in the U.S. and Canada. On the contrary, Afterpay was originally founded in Sydney, Australia, and is used on a wider scope including the United States, Canada, Australia, New Zealand, the United Kingdom, and other countries in the EU.

    Sezzle Vs Afterpay: Merchant Network

    More than 40,000 retailers in the U.S. and Canada offer Sezzle, while Afterpay is used by over 85,000 merchants worldwide.

    Sezzle Vs Afterpay: Rescheduled Payments

    Sezzle offers a plan where you can reschedule your payment for free the first time. However, if you attempt to reschedule another installment, you will be charged $5 extra per payment. In order to qualify for this benefit, try to reschedule well in advance, at least 48 hours before the due date.

    Afterpay, on the other hand, didn’t initially allow rescheduling, but now they do under certain conditions. The conditions include:

    • You can only reschedule payments once per purchase.

    • Some purchases may not be eligible for date changes.

    • You cannot reschedule overdue payments or those due within 24 hours.

    • You can only access the repayment feature if you have been an Afterpay user for more than 42 days.

    Sezzle Vs Afterpay: Limit

    The credit limit when using Sezzle is $2,500, but new customers may initially start with a lower limit. Regular on-time payments can lead to a higher credit limit.

    Afterpay, on the other hand, has a maximum balance of $2,000 on your account at any time, with individual purchases having a spending limit of $1,500. New users may get a lower credit limit initially, which can be increased based on their payment history.

    Sezzle Vs Afterpay: Fees

    Sezzle requires retailers to pay a flat rate of $0.30 and 6% of the transaction price of each order. However, customers making repayments on time are not charged any fees unless they reschedule multiple repayments or completely default on a payment.

    Afterpay applies a 4.17% merchant fee for all sales. Late payments incur a $10 fee and an additional $7 fee after seven days. If you are keen on saving your money, ensure you can adhere to their terms before committing to using this option.

    Note: We advise you to use a budgeting tool to avoid late payments and additional fees when using any Buy Now Pay Later services.

    An Executive Summary

    We have looked at many aspects of the BNPL solution, specifically focusing on Sezzle and Afterpay. Below is a summary of what we’ve covered:

    What is BNPL and Whom Does it Serve?

    BNPL stands for “Buy Now, Pay Later.” It is a payment plan allowing customers to make purchases and defer the payment to a later date. Typically, customers can divide the total cost of their purchase into multiple easy payments without incurring any interest.

    BNPL services serve both consumers and merchants. It offers flexibility for consumers, enabling them to manage their money more effectively by staggering their spending in intervals rather than all at once. It also attracts budget-conscious customers who wouldn’t typically make larger purchases, increasing sales for retailers.

    Some popular BNPL service providers include Afterpay and Sezzle.

    Sezzle Vs Afterpay: Similarities

    The similarities include:

    Payment Structure

    Both Sezzle and Afterpay offer a buy now, pay later payment structure, allowing customers to make payments in equal installments over time.

    Interest-Free Payments

    Both platforms facilitate interest-free payments, making it an attractive option for shoppers with lower spending power.

    Approval Process

    Both Sezzle and Afterpay have simple and quick approval processes, often requiring only basic information and no credit checks for smaller purchases.

    Customer Base

    Both services target primarily online shoppers, providing a convenient payment method for e-commerce transactions.

    Sezzle Vs Afterpay: Differences

    The differences include:


    Afterpay is available in more countries than Sezzle.

    Eligibility Criteria

    Sezzle offers easier access and is more lenient in its approval process, accepting customers with lower credit scores, whereas Afterpay has stricter eligibility requirements.

    Merchant Network

    While both platforms have an extensive network of partnering merchants, there may be differences in the specific brands and retailers available on each site.

    Summary of Similarities and Differences

    Payment MethodBuy Now, Pay LaterBuy Now, Pay Later
    AvailabilityPrimarily in the U.S. and CanadaU.S., Canada, New Zealand, Australia, U.K., Spain, France
    FeesMerchant fees, no interest for usersLate fees and interest may apply
    Number of Payments4 installments4 installments
    Approval ProcessSoft credit checkSoft credit check
    UsersPrimarily focused on younger shoppersWidely used by various demographics

    The Bottom Line

    In conclusion, the comparison between Sezzle and Afterpay reveals two prominent players in the Buy Now, Pay Later (BNPL) market, both offering attractive solutions for consumers seeking flexible payment options.

    Sezzle, with its emphasis on inclusivity and responsible spending, has successfully carved a niche among younger customers and those with limited credit history. Its feature of interest-free payments adds appeal to budget-conscious shoppers.

    On the other hand, Afterpay has solidified its position as a global leader in the BNPL space, boasting a wide network of partner merchants and a user-friendly interface. The Afterpay app caters to a broader demographic, capturing a larger market share. However, its late fees policy might deter some users and raise concerns about financial responsibility.

    Ultimately, the choice between Sezzle and Afterpay boils down to the shopper’s needs and preferences. Those who prioritize interest-free options and a supportive community gravitate toward Sezzle, while consumers seeking a vast array of merchant options and a more established platform opt for Afterpay.

    Frequently Asked Questions About BNPL Services

    What type of purchases does BNPL facilitate?

    BNPL typically allows you to purchase products of a wide range, but some providers may have restrictions on certain items or categories.

    What are the benefits of using BNPL?

    BNPL can offer flexibility and convenience for budgeting purposes.

    Are there any downsides to using BNPL?

    If not used responsibly, BNPL can lead to overspending by incurring a late fee. Make sure you understand the terms and manage your repayment plan to avoid potential issues.

    Which company offers BNPL services?

    Several companies offer BNPL facilities, including Afterpay, Affirm, Sezzle, and Klarna. Availability may vary by region.

    Here are a few comparisons:

    Klarna vs Afterpay

    Affirm vs Afterpay

    Is BNPL available globally?

    BNPL has become increasingly popular worldwide, but its availability might differ depending on your location.

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