Suncorp Bank teams up with Visa to offer buy now pay later service
Suncorp Bank has announced the launch of a new buy now pay later (BNPL) platform, PayLater, joining a growing number of Aussie banks to have made moves into the sector in recent months.
Suncorp has announced that it will enter the growing Australian BNPL market, with the launch of its PayLater platform in November. The bank says that PayLater, available via the Suncorp app, will allow customers to make purchases at any location that accepts Visa, which is more than 70 million merchant locations worldwide.
Visa’s country manager for Australia, Julian Potter, said the company was “excited to partner with Suncorp”, noting the growing nature of the BNPL sector and adding that PayLater would be a “seamless and secure” experience for customers.
What is PayLater?
PayLater is a forthcoming buy now pay later service from Suncorp. It will launch via the Suncorp app in November 2021, and in what Suncorp describes as a first for the Australian market, customers will have the option of a physical as well as a digital card. Suncorp says that the physical and digital versions of the PayLater card will be yellow, to differentiate them from the bank’s existing ‘pay now’ debit card, which is green.
How does PayLater work?
PayLater will be available for purchases higher than $50, up to a limit of $1,000 once Suncorp determines a customer’s eligibility following a credit check. Suncorp says eligible customers will receive “quick approval” after applying online or via the Suncorp App.
Repayments will then be made in four equal fortnightly instalments. The platform will offer customers the ability to change their repayment day by up to six days.
How much does PayLater cost? Does it have late fees?
Suncorp says that PayLater has a two-day grace period for missed repayments, and then a capped $10 late fee per purchase. There will be no foreign exchange fees for international purchases online or in-store, and no ongoing fees when customers pay on time.
Is buy now pay later risky?
In its November 2020 report into the industry, the Australian Securities and Investments Commission (ASIC) found one in five consumers in the previous year had missed or been late paying other bills, such as household bills (44%), credit card repayments (32%) and home loan repayments (22%), in order to make BNPL repayments on time.
The same report also found a number of Australian consumers had experienced financial hardship in an attempt to make BNPL repayments on time, cutting back on or entirely foregoing household essentials such as meals, or taking out additional loans.
Therefore, before using a BNPL service, it is worth considering your financial situation carefully, and thinking about whether you are confident in your ability to make repayments. It is also worth asking yourself whether you need the thing you plan to purchase now, or if you can purchase it in another way, such as by saving money for it.
In March of 2021, a number of Australia’s major BNPL lenders signed up to a voluntary code of practice with ASIC, setting out minimum standards they are required to meet, including credit checks on transactions of more than $2,000.
Suncorp’s PayLater has a maximum limit of $1,000 for purchases, but the bank says it will still perform credit checks before approving customers for this amount. Likewise, Suncorp says that it has put rules in place to ensure that customers cannot use the PayLater service for cash advances or gambling transactions.
Cover image source: MadamF/Shutterstock.com
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This article was reviewed by our Sub Editor Tom Letts before it was updated, as part of our fact-checking process.
Alasdair Duncan is a Senior Finance Journalist at Canstar, specialising in home loans, property and lifestyle topics. He has written more than 200 articles for Canstar and his work is widely referenced by other publishers and media outlets, including Yahoo Finance, The New Daily, The Motley Fool and Sky News. He has featured as a guest author for property website homely.com.au.
In his more than 15 years working in the media, Alasdair has written for a broad range of publications. Before joining Canstar, he was a News Editor at Pedestrian.TV, part of Australia’s leading youth media group. His work has also appeared on ABC News, Junkee, Rolling Stone, Kotaku, the Sydney Star Observer and The Brag. He has a Bachelor of Laws (Honours) and a Bachelor of Arts with a major in Journalism from the University of Queensland.
When he is not writing about finance for Canstar, Alasdair can probably be found at the beach with his two dogs or listening to podcasts about pop music. You can follow Alasdair on LinkedIn and Twitter.