What Is Sezzle Payment and How It Compares to Other Options

Sezzle Payment is a popular buy now, pay later option that allows you to split purchases into four interest-free payments over six weeks.

Sezzle Payment is similar to other options like Affirm and Afterpay, but with a few key differences.

Sezzle offers more flexible payment plans, allowing you to choose from four different payment schedules, whereas Affirm typically offers two to 12 months of payment plans.

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Sezzle's payment plans won't affect your credit if you check eligibility, as neither Sezzle nor Affirm pull credit scores or report to the credit bureaus.

If you sign up for Sezzle Up, you'll get points with the three major credit bureaus for using the program and paying it off as agreed, but be aware that missing a payment will be reported to the credit bureaus.

Bad credit can be hard to overcome, so it's wise to avoid doing anything to downgrade your creditworthiness, which is why Sezzle doesn't report to credit bureaus unless you have Sezzle Up.

Broaden your view: Credit Bureaus Definition

Shop Pay won't affect your credit score. Neither Sezzle nor Affirm, the company behind Shop Pay installments, pull credit scores or report to the credit bureaus.

Sezzle doesn't report to credit bureaus unless you have Sezzle Up, which is optional.

Having Sezzle Up can be beneficial if you're trying to build credit, as you'll get points with the three major credit bureaus for using the program and paying it off as agreed.

However, if you do miss a payment, that will be reported to the credit bureaus, which can be detrimental to your creditworthiness.

It's essential to carefully consider whether you're ready for the responsibility of Sezzle Up before signing up, as bad credit is hard to overcome.

Missing a payment with Sezzle Up can have serious consequences, so it's crucial to make all your payments on time.

Take a look at this: Which Government Agency Regulates Credit Bureaus

Your Sezzle credit limit, also known as your spending limit, may vary from store to store. It's determined by Sezzle's assessment of your repayment history and a soft credit check.

You'll see your spending limit when you sign into the store you want to make a purchase from. This limit can change over time as you continue to use the app and make on-time payments.

Here's a breakdown of how your spending limit can change:

Keep in mind that customer service agents cannot manually change your spending limit, so you'll need to continue using the app and making on-time payments to raise your limit over time.

Sezzle makes money primarily by charging merchants fees in the form of a Merchant Discount Rate, which is a percentage of the total basket value.

Sezzle's standard payment processing fee is 6.1% plus 30¢ per transaction, with merchant-related fees comprising approximately 82% of Sezzle’s total Income in 2021.

Sezzle pays merchants for the transaction value upfront, net of the merchant fees owed to Sezzle, and assumes all costs associated with the consumer payment.

Sezzle's core product offering is free for consumers who pay on time, with consumer-related revenue making up only 18% of Sezzle’s total Income in 2021.

Sezzle earns a rescheduled payment fee when consumers delay payment for up to two weeks, and also charges a fee to reactivate an account following a failed payment.

Sezzle made $115 Million in 2021, a 95% growth rate from 2020, with revenue mostly coming from merchant fees.

For more insights, see: Merger Filing Fee Modernization Act of 2021

Sezzle offers flexible payment terms that differ from traditional credit cards. You can choose to pay off your balance in two weeks, six weeks, or up to 48 months with equal payments for each time period.

If you want to spread out payments over a longer period, you may need a full credit check by a third-party lender. This is in contrast to traditional credit cards, which often require a hard pull credit check.

Sezzle also doesn't charge interest when making installment payments within two or six weeks. However, if you extend payments over a longer period, you may be subject to interest charges.

Here's a comparison of Sezzle with other buy now pay later providers:

Keep in mind that Sezzle's credit limit can change over time based on your repayment history, whereas traditional credit cards may not be as responsive to your behaviors.

Sezzle's payment terms differ from traditional credit cards, allowing you to choose from two weeks, six weeks, or up to 48 months to pay off your balance with equal payments.

With a credit card, you're able to make just minimum payments or pay your purchase off more quickly. This can lead to a longer payoff period and more interest paid overall.

Sezzle doesn't charge interest when making installment payments within two or six weeks, which can save you money in the long run.

However, traditional credit cards will have a specific interest rate for each purchase, which can add up quickly if you're not paying off your balance in full each month.

Sezzle's credit limits can vary based on your repayment history and a soft credit check, whereas credit card companies typically do a hard credit check.

Here's a comparison of Sezzle and traditional credit cards:

Sezzle has several competitors in the buy now pay later space, each with their own unique features.

Affirm is similar to Sezzle, offering multiple payment options and reporting to credit bureaus in some cases.

Afterpay has interest-free loans, but only offers one type of payment plan and doesn't report to credit bureaus.

Klarna offers flexible payments, including "pay in four installments" and "pay in 30 days" options, and has late fees like Sezzle.

Late fees are a common feature among BNPL providers, including Afterpay and Klarna.

Sezzle and Klarna both offer in-person shopping options and have late fees, but Sezzle doesn't report to credit bureaus like some of its competitors.

A different take: Afterpay Stores Target

Sezzle offers flexible payment plans that allow you to pay for purchases over time. This can be a big advantage for those who want to budget their payments.

One of the benefits of Sezzle is that it performs a soft credit check, which won't harm your credit score. This is a plus for those who are concerned about their credit history.

Sezzle has partnered with many merchants, giving you a wide range of options for using the service. You can shop at popular stores and pay for your purchases over time.

However, you may need to upgrade to Sezzle Premium to use some of its partner merchants. This can be a drawback for those who want to use the service with their favorite stores.

Sezzle also allows you to reschedule payments if you need to. This can be a big help if you're facing unexpected expenses or financial setbacks.

But be aware that there are fees involved if you reschedule payments or miss a payment. These fees can add up quickly, so it's essential to stay on top of your payments.

Here are the pros and cons of Sezzle in a nutshell:

Your credit limit may start out small, but you can work your way up with on-time payments and a good payment history with Sezzle.

Sezzle offers several options to enhance your shopping experience, including Sezzle Premium, which gives you access to bigger brands like Lowe's and Hotels.com.

Sezzle Premium comes with a monthly or annual cost, but it's worth it for the extra perks, such as Sezzle Rewards points and priority customer service.

With Sezzle Virtual Card, you can shop at merchants like Target, even if they don't have a direct agreement with Sezzle.

You'll use the virtual card to complete transactions, and then pay off the card with a 25% down payment and installments.

Sezzle Up is an optional feature that allows you to opt into a credit-building company, which will report your payment history to the credit bureaus.

This can help you build a strong credit profile over time.

Sezzle Anywhere offers the flexibility to shop online retailers, pay in-store, or even pay bills with the same payment plan, using your Sezzle virtual card, accepted anywhere Visa is accepted.

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Here are the different options available with Sezzle: