Research reveals top-rated buy now pay later providers for 2021

Deputy Editor · 22 September 2021
New Canstar research reveals which buy now pay later providers in Australia came out on top in a detailed assessment of their fees, product features and the protections and support they offer consumers.

As part of its first ever annual Buy Now Pay Later Award, Canstar’s experts assessed 10 eligible providers, while a separate Most Satisfied Customers Award has revealed which provider’s customers are most content with the service they’re using.

Canstar’s General Manager, Research and Insights, Mitch Watson, said the Awards were designed to help consumers navigate what has become an extremely popular but complex product category.

“The buy now pay later space has grown considerably over the past few years, in both the number of providers in the market and the number of Australians adopting it as a payment method,” he said.

“On the face of it, the choice of who to go with may seem straightforward, with most buy now pay later providers offering a similar product. However, they can vary significantly, including the fees, application process, how payments are managed, retailer availability and access to customer service.

“We believe our unique research can help guide consumers towards the buy now later products that offer the most value for money.”

Afterpay and Humm receive Canstar’s inaugural Buy Now Pay Later Award

Afterpay and Humm came out on top following Canstar’s analysis of 10 eligible buy now pay later platforms.

BNPL Award - Afterpay and Humm


According to Canstar Research, a major strength for Afterpay was its broad availability across key retailers and the flexibility it offered customers to manage repayments.

While its late fees were not among the lowest in the market – it charges $17 if the customer remains in arrears for seven days after the initial due date – fee caps limit costs to 25% of the purchase price or $68, whichever is lower.

When it comes to support offered to consumers, Afterpay’s platform offers a variety of options, including dedicated hardship and complaints teams, links to independent financial counselling, and a call-centre available Monday to Saturday.

Afterpay is among the providers which do not conduct credit checks on applicants, however it does employ other safeguards to mitigate the risk to consumers who use the product. For example, the maximum spend limit for new customers is reduced to $600, new customers cannot make multiple purchases within the first 24 hours of being approved, and to ensure the customer has enough funds in their account, the first instalment is taken at the time of purchase.


Compared to other providers in the market, which can charge their customers up to $10 per missed payment, Humm’s late fees are capped at $6 for each payment not paid by the due date. For the 20% of Australian consumers that are missing at least one of their scheduled repayments, these low fees could make a significant difference to those experiencing financial difficulty, Canstar Research noted.

Humm’s online platform can be accessed and managed via desktop and mobile, and provides a variety of options for managing the account, contacting customer support and making changes to the repayment schedule.

Humm conducts credit checks for customers applying for larger spend limits up to $30,000 through its ‘Big things’ product, but no credit checks are carried out for customers applying for smaller spend limits up to $2,000. Humm says it places spending limits on new customers in some cases as an extra precaution.

Selected features of Afterpay and Humm

Feature Afterpay Humm
Are credit checks conducted? N Only for ‘Big things’ customers applying for spend limits up to $30,000
Are late fees capped? Y Y
Retailer examples Kmart, BigW, Target, Myer, Officeworks, JB Hifi Myer, RedBalloon, Kogan, Cotton On, Michael Hill, IKEA
Standalone product? Y Y
Salary credit required? N N
Is live online chat available? N Y
Is there a call centre available? Y (Mon-Sat) Y (Mon-Sat)
Is there support for financial hardship? Y Y

Source: Prepared on 10/09/2021. Based on BNPL providers rated in Canstar’s Buy Now Pay Later Star Ratings & Awards (August 2021).

How did Canstar Research rate the other buy now pay later providers considered?

As well as awarding the providers who came out on top following its analysis, Canstar Research rated each of the eligible providers based on the same price and features methodology. The table below is sorted by Star Rating, then alphabetically by provider name.

Provider Star Rating
Afterpay 5
Humm 5
Bundll 4
Latitude Pay 4
Laybuy 4
PayPal 4
StepPay 4
ZipPay 4
Klarna 3
Openpay 3

How did Canstar’s experts assess providers for the Buy Now Pay Later Award and Ratings?

With a 2020 report from financial services regulator ASIC finding one in five buy now pay later customers were missing their repayments, Mr Watson said it was important that Canstar’s Award reflected not just the value the providers can offer compared to their peers, but also the potential risks to consumers if these products are used inappropriately.

He said the methodology was developed following an extensive review of the market, findings from regulators and information from a range of other sources.

“What was clear from this is that our assessment of the products needed to focus in on a number of areas, including the fees and charges, especially if someone misses a payment; the checks and balances conducted when approving someone for a product; how the products provide flexibility around making payments; what access customers have to customer service; and what processes are in place to assist customers in times of financial hardship.”

In calculating the cost of using the services, Canstar examined a number of transaction amounts ranging from $100 to $1,000, and three separate repayments scenarios, including examples of an individual missing repayments.

The research showed a significant difference in costs between providers, particularly for customers who miss a repayment or end up defaulting on their buy now pay later account.

Buy now pay later costs based on $100 transaction

Scheduled repayments
(Repaid using the prescribed repayment method with no avoidable fees incurred.*)
Scheduled repayments
(As per repayment schedule, but a required minimum repayment is missed, incurring a late fee if applicable.)
Maximum late fees
(No repayments made for three months. Maximum late fees incurred.
Min $0 $0 $0
Average $0.30 $8.05 $25.25
Max $6 $10 $50

Source: Prepared on 9/09/2021. Based on providers rated in Canstar’s Buy Now Pay Later Star Ratings & Awards (August 2021). *Where there is no structured repayment plan, it is assumed that consumers will repay the balance in equal instalments over a six-week period. It is assumed the first repayment is made at the time of purchase.

The methodology for the Buy Now Pay Later Award, which balances price and features, is similar to those used by Canstar in assessing other financial products such as credit cards and personal loans.

Who won Canstar’s Most Satisfied Customers – Buy Now Pay Later Award?

Afterpay also proved to be the buy now pay later provider with the most satisfied customers in 2021, according to a Canstar survey of more than 2,000 Australian consumers.

BNPL Satisfaction Award - Afterpay

Those surveyed were asked to score their experience with their buy now pay later service in seven different areas:

  • Customer service
  • Value for money
  • Fees and charges
  • Communication
  • Retailer availability
  • Set up and application
  • Mobile app

Afterpay’s customers gave it a high score across the board, but were particularly pleased with the provider’s value for money, set up and application and retailer availability.

Mr Watson said the survey showed that, overall, buy now pay later customers are more satisfied with their providers overall than customers in many other product categories, such as credit cards and home loans.

“What really comes through in the responses is a higher satisfaction on ‘value for money’ and ‘fees and charges’. On those metrics, it’s not hard to understand why, when customers who use the product appropriately can in many cases avoid paying any fees,” he said.

Looking at the breakdown of customers, Tasmania was the state with the most satisfied buy now pay later customers, women gave their provider a higher score on average than men, while older Australians were generally more satisfied than younger customers.

Cover image source: BalanceFormCreative/

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This content was reviewed by Sub Editor Tom Letts as part of our fact-checking process.

Sean has accumulated more than a decade of experience in journalism and communications roles in Australia, the UK and Ireland. His work covers a range of topics including finance, banking, property, investing, consumer and legal affairs, and more.

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