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How Does Perpay Work And Who Should Use It?
If you have searched for a way to buy now and pay later, then you must have come across Perpay. It combines shopping flexibility with an in-built repayment system linked directly to your paycheck.
It's exciting that the platform also offers an optional service that can help you build your credit score through consistent and on-time repayments.
This review will explore everything you need to know about Perpay. These include how it works, its pros and cons and whether it is right for you.
What Is Perpay?
Perpay is a buy now, pay later (BNPL) platform, which was launched in 2014 in Philadelphia, Pennsylvania. The unique feature about the site is that, unlike other BNPL companies, it operates its own online marketplace. What this means is that you cannot use it at external stores. Instead, you can browse and buy products directly from the site and then pay in fixed installments from your paycheck.
If you are employed and want to avoid interest charges and installment payments, this BNPL service is the best option for you. Another fantastic thing is that your credit history does not determine your eligibility. It sets your spending limits based on your income, employment stability and your repayment history.
What Are the Key Features of Perpay?
Here are some of the key features that make the site one of the best BNPL platforms.
There's no interest rate on any purchase; the listed product price is what you pay.
The platform deducts your payments automatically on payday directly from your paycheck.
It offers optional credit-building services, which are known as Perpay+. This feature reports payments to credit bureaus.
The Perpay Credit Card
Another interesting feature is the credit card. This credit card is designed for users who want to shop outside the platform while still enjoying the benefits it has to offer.
Key Features
The credit card is issued by the Celtic Bank, Member FDIC.
It is a Mastercard and is usable anywhere Mastercard is accepted.
Just like marketplace purchases, payments are taken directly from your paycheck.
You get to earn up to 2% cashback added to your balance.
Is Perpay Legit?
For the past decade, the company has been doing wonders in the industry, so they are very legit. There have been no complaints and scandals from users, and the company is steadily pushing out new features to satisfy its customers.
How Does Perpay Work?
You need to understand how the platform works to decide if it's the best option for you. Here's a step-by-step explanation of how the platform works.
Sign Up
The first step is to create an account on the website or mobile app. You will provide basic personal information along with proof of employment during sign-up.
Get Your Spending Limit
Your spending limit is determined by your income and pay frequency. It's not determined by your credit score. For new customers, limits typically start between $500 and $1,000, but can grow as you make timely payments.
Shop on the Marketplace
There are different items to purchase on the marketplace, from brands like Apple to Samsung. Surf the marketplace and pick whatever item catches your fancy.
Submit Your Order
Once you select your items, the next step is to submit the order for approval. The platform checks your available spending limit and ensures your direct deposit setup is ready.
Set Up Payroll Deduction
You need to allocate a portion of your paycheck to them through your employer’s direct deposit system. This ensures that payments come straight from your income before you spend it.
Choose Your Installment Plan
You can choose the payment option that works perfectly for you from the available options. However, the exact duration depends on the price of the item you purchased and your pay schedule.
Shipping after your first payment
Your order will be shipped after your first payment is made. This means that delivery can be slower than shopping directly from a retailer.
Automatic Deductions Until Paid Off
The installment payments continue until your balance is cleared.
Optional Perpay+ Enrollment
After your first purchase, you can subscribe to Perpay+, which will report your on-time payments to the major credit bureaus.
Managing Your Perpay Account
Keeping track of your account is easy. Whether you want to see your current balance, check upcoming payments or review your account status, you can log in anytime through the app or website.
If you’d like to clear your balance faster than planned, you can boost the amount the platform collects from each paycheck. And if your employment changes or there’s an issue with direct deposits, you can switch to an alternative payment method, such as using your credit or debit card, to complete your payment.
How Much Does Perpay Really Cost?
Note that while it charges no interest on products purchased, the prices are often higher than those in traditional retail stores. This is how the company makes money without charging interest.
How to Determine Your Eligibility
Unfortunately, the platform is not accessible to everyone. Only employed U.S residents with a steady income have access to the service. Before you get excited, there are also a few requirements you need to meet.
Who Is Eligible?
To be eligible to use this service, you must:
Be at least 18 years old and a U.S. resident.
Have a consistent income. You must have full-time employment to qualify.
Be working with your current employer for at least three months.
Possess a mobile phone.
Receive your pay through direct deposit from your employer.
Have no current bankruptcies.
Provide proof of employment.
Who Is Not Eligible?
Freelancers, gig workers or small business owners who don’t have a payroll-based direct deposit aren’t eligible.
Cash-paid workers: Even if you have a steady income, without direct deposit, you can’t use this BNPL service.
Unemployed individuals: Since repayment is tied to your paycheck, no paycheck means no access.
People outside the U.S.: It is only available domestically.
Pros and Cons of Perpay
Like every other financial tool, the platform has its strengths and a few drawbacks:
Pros
There's no added interest on purchases.
Your credit history does not determine your eligibility. People with poor credit history can be eligible for the platform.
Payments are taken directly from your paycheck, helping you avoid missed or late fees.
The marketplace has thousands of items from popular brands, so you have numerous options to select from.
Cons
You can only buy items listed on the platform, not from external retailers.
Prices on the platform are higher than those of regular retailers.
Self-employed, gig workers or cash-paid employees can’t use this service.
Your items are shipped only after your first payment, which can add several days to delivery.
Final Thoughts
Perpay stands out amongst the different BNPL options for so many reasons. Its paycheck-based payments and no interest on purchases make it a tempting offer. If you’re a disciplined budget shopper, this should be your go-to platform. However, it comes with a few drawbacks, especially with its higher prices and limited shopping options. So, if you’re chasing rock-bottom prices or faster delivery, you should probably consider using BNPL services instead.
Perpay requires proof of employment and direct deposit to set up your account. If you don’t have a ready paystub, you can quickly create one online with our Paystub Creator. It’s fast, accurate and will get you ready to start shopping in no time.
