Buy Now Pay Later Cards or BNPL Cards are getting significant attention from people these days. These cards enable the user to spend today and pay later for the same. People here often say what’s the difference between a BNPL card and a credit card as both of them enable a person to pay for their transactions at a later date. So let’s find out what makes them differ from each other.
Difference in usage pattern:
Credit cards generally offer discounts and cashback for some of their transaction. Some category-specific credit cards often get you tons of reward points or RPs or cashback if used on the correct category outlet or at partnered outlets.
BNPL cards enable a user to shop in outlets or online shopping sites using the card and pay later for the same at a later date. They have the option to convert the payments into EMIs and often give cash-back if the prompt payments for the bill are made. Other than this, they do not provide any offers or discounts on specific categories.
What are these cards suited for?
Credit cards are quite handy when shopping online or offline. They offer cashback though only on certain outlets and also enable you to pay later for whatever you shop for today. Also, Credit Cards offer value-added benefits on category-specific purchases like Fuel spending, travel, and such like. Diners Club Black Credit Card from HDFC Bank Offers a lot of these features.
BNPL cards are good for people who don’t go shopping often using credit cards or credit facilities and need a short credit facility at times. This might also come in handy for people who are not brand-specific in terms of shopping.
One-time Cost and Running Fee:
While Credit cards bring in a lot of fees and interest, BNPL cards hardly have any fees attached to them. Credit cards, offering more vouchers and rewards often cost more in terms of annual fee, joining fee, and interest. There are a few credit cards that have no annual fee but won’t have anything to offer either. Many cards levy interest on their transactions making them a bit costly to own.
BNPL cards mostly have zero joining fees. The running fee can be between Rs.500 to Rs.1200. Also, the bill comes in with zero or minimal interest charges. With minimal benefits, these charges seem to be viable for those who don’t use credit facilities very often. Uni Pay 1/3rd Card is one of the best performing BNPL cards in the market today.
Best Suited for?
Credit cards are a good choice for someone who wants to increase his/her credit score and use credit facilities or debit cards earlier. With tons of rewards, these make up a good pair with someone who shops a lot online and offline and often uses them on category-specific purchases such as Fuel transactions and Travel.
BNPL cards are good for people who do not need a lot of credit facilities or are starting with the use of credit facilities. BNPL cards give an Idea of how credit works and how to pay bills on time. Students often prefer these cards over credit cards as they have no joining fee or credit score requirements.
Additional Reading: Lifetime Free Credit Cards With Lounge Access
