The Buy Now, Pay Later Walmart Program: What You Need to Know
Buy now, pay later is a payment option for Walmart customers, but it may not be the best financial decision.
Chris Scott
Contributing Writer at Tally
October 14, 2022
When you’re shopping at Walmart, you have a few payment options available, including the buy now, pay later program. Essentially, if you use this payment option, you’ll pay for a portion of your purchase upfront and receive your purchase immediately. You’ll then pay off the remainder of your purchase in a series of installments.
Using the buy now, pay later Walmart program can be tempting, but there are some things you should be aware of before using it.
In this article, we’ll cover everything you need to know about the buy now, pay later Walmart program, including:
How it works
Its benefits and drawbacks
Other types of buy now, pay later programs
By the end of this article, you should have a much better understanding of whether the buy now, pay later Walmart program is a good option for you.
What is the buy now, pay later Walmart program?
Walmart buy now, pay later (BNPL) is a financing option available to customers when making a purchase. When making a purchase with the buy now, pay later option, you’ll pay for a portion of the purchase at checkout. Then you’ll pay off the remainder of the purchase via a payment plan. These payment plans typically involve monthly payments.
Walmart partners with Affirm for its buy now, pay later services. If you elect to use the Walmart BNPL program, you’ll be using the Affirm platform, which will be outlined in the sections below.
How does the buy now, pay later Walmart plan work?
Customers can utilize the BNPL Walmart program either in store or online. To use the service for in-store Walmart purchases, customers first need to visit affirm.com to apply. To use it shopping online, visit affirm.com/walmart.
Purchases that are eligible for the buy now, pay later Walmart program include:
Electronics
Video games
Toys
Musical Instruments
Home goods and home improvement
Arts and crafts
Auto
Tools
Sports and outdoors
Baby
Jewelry
Apparel
Other categories like personal care, health and wellness, gasoline and food are not eligible.
Affirm is unique because you can set the duration of your installment plan. Other BNPL programs require you to pay for the total amount of your purchase within four monthly payments, the first occurring at checkout. Affirm, however, allows you to choose a payment plan that takes between three and 48 months, so long as your eligible purchase costs at least $144 and not more than $12,000.
Affirm checks whether you prequalify before checkout. Doing so will not impact your credit score. However, if you do elect to use Affirm for your Walmart purchase, you may be subject to a credit check, since you are technically applying for a loan. This credit check could have an impact on your credit score.
When shopping on Walmart.com, you may see that certain products are eligible for interest-free financing. This means that you pay 0% interest when using the BNPL program. These are often promotional offers. Typically, your rate will not be 0%; it will likely range between 10% and 30% with Affirm. These are fixed costs built into your repayment plan.
The last thing worth mentioning is that Affirm does not charge late fees and doesn't have hidden fees. However, missing a payment will likely impact your credit score and may impact your ability to secure another Affirm loan in the future.
What are the benefits of the Walmart BNPL plan?
Walmart BNPL allows you to take home your purchases with just a down payment. If you need to buy something and don’t have the means to pay, the buy now, pay later Walmart plan could allow you to still make the purchase.
It may be easier for those with low credit scores to be approved for a BNPL loan, compared to a credit card. However, there are downsides to consider before signing up for the program.
What are the downsides to the Walmart BNPL plan?
There are a few disadvantages to the Walmart BNPL plan:
Affirm may perform a credit check every time you make a purchase using the service. If you use the service frequently, you may end up harming your credit score.
High fixed interest rates. The interest rate on your purchase could be as much as 30%. These are fixed, meaning they are built into your monthly payments and you will be required to pay this interest, much like with an auto loan. This is not like a credit card purchase where, if you pay your statement balance in full by the due date, you are not charged any interest.
Are there other buy now, pay later programs?
Yes, there are other buy now, pay later plans available, including third-party vendors. If you plan to use one of these vendors, research their terms, conditions and eligibility requirements. Examples of other BNPL programs include:
You may find that specific retailers have BNPL programs, like Walmart. Amazon, Best Buy and Apple offer BNPL payment methods.
Are BNPL plans a good idea?
Proceed with caution when using BNPL programs. The programs were recently investigated by the Consumer Financial Protection Bureau for predatory lending practices.
The Director of the Bureau, Rohit Chopra, recently told reporters, “We want to ensure buy now, pay later firms are subjected to the appropriate examination just like regular credit card firms.”
Previously, he had stated, “Buy now, pay later is the new version of the old layaway plan, but with modern, faster twists where the consumer gets the product immediately but gets the debt immediately too. We have ordered Affirm, Afterpay, Klarna, PayPal and Zip to submit information so that we can report to the public about industry practices and risks.”
As a shopper, you should understand the risks associated with BNPL programs. Instead of using a BNPL program, you could:
Have enough cash on hand for your purchase, or consider paying with a debit card
Create and stick to a budget to help prevent overspending
Build an emergency fund to help in times of need
BNPL programs may be convenient, but it’s important to understand the risks associated with them before applying.
You can be a smart shopper without the Walmart BNPL plan
The buy now, pay later Walmart plan through Affirm may be a tempting option at checkout, especially if you receive an offer for 0% APR. However, there are some risks associated with the program that you should be aware of. If you do have to pay interest, the interest is fixed, meaning it’s built into your repayment plan. In addition, missing a payment could harm your credit score.
BNPL programs have recently been investigated by the Consumer Financial Protection Bureau for possible predatory lending practices. Instead of utilizing one of these programs, consider healthier financial habits, like budgeting for an upcoming purchase and creating an emergency fund.
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