What Happens If Your Afterpay Payment Is Late?

Afterpay provides consumers with a “buy now, pay later” service, allowing purchases to be split into multiple interest-free installments. Failing to make scheduled payments can lead to various consequences, affecting both immediate account access and future financial standing.

Understanding Immediate Consequences

Missing a scheduled Afterpay payment triggers immediate actions. A late fee may be applied to the overdue amount. For orders under $40, a one-time late fee, capped at 25% of the total order value, is charged. For orders of $40 or more, an initial $10 late fee applies, with an additional $7 fee if the payment remains unpaid after seven days. Regardless of the order value, the total late fees for any single order will not exceed 25% of the original purchase price or $68, whichever amount is lower.

Upon a missed payment, Afterpay will pause the user’s account, preventing any new purchases until the overdue amount is settled. Afterpay also sends reminders leading up to a payment due date and alerts after a payment has failed.

Steps to Resolve a Late Payment

When a payment is late, promptly addressing the overdue amount is the most effective way to restore account functionality. Users should log into their Afterpay account, either through the mobile application or website, to view their payment schedule and identify the specific overdue installment. The platform clearly displays any outstanding balances.

Users can manually make an overdue payment directly through the Afterpay app or website by selecting the relevant installment and initiating payment. It is also possible to update payment methods if the original one failed. If difficulties arise in making a payment or if a payment arrangement is needed, contact Afterpay customer support. Support can be reached through in-app messaging, email, or by requesting a callback, though direct phone line availability may vary. In some instances, Afterpay may allow a payment to be rescheduled by up to a week, up to three times a year.

Effects on Your Afterpay Account

A history of late payments can significantly influence a user’s ability to utilize Afterpay in the future, even after overdue amounts are settled. Afterpay employs an internal assessment system that evaluates a user’s repayment behavior. Consistent on-time payments can lead to increased spending limits over time, indicating responsible usage.

Conversely, a pattern of missed or late payments can result in a reduced spending limit. In more severe or persistent cases, Afterpay may suspend the account for a longer term, or decline future purchases altogether. These internal account restrictions are distinct from any external credit reporting and are based solely on the user’s payment history.

How Late Payments Can Affect Your Credit

Afterpay’s approach to credit reporting differs from traditional lenders, especially for its standard “Pay in 4” service. Afterpay generally does not report on-time payments to major credit bureaus in the United States. This means that consistently making timely payments on these accounts typically does not help build a positive credit history.

Despite this, late payments can still impact a user’s credit standing under certain circumstances. Afterpay may report severe delinquencies, defaults, or accounts that are sent to collections to credit bureaus. If an account is transferred to a collections agency, this negative mark can appear on a credit report. Such negative entries can significantly lower a credit score, making it more challenging to obtain future credit, such as loans or credit cards, from other financial institutions.