Openpay is an interest-free Buy Now Pay Later (BNPL) payment platform. It has been available in Australia and New Zealand since 2013, before launching in the UK in 2019 and in the US in 2020. Openpay covers various sectors including retail, automotive, home renovation, and more.
You can download the Openpay app from the App Store or the Google Play Store, which had more than 500,000 downloads in January 2022. You can also create an account online on the Openpay's website.
However, the company disclosed in February 2022 that it intends to mostly withdraw from the UK market, and will only remain available through specific merchant partners. This means that soon you may no longer see Openpay at stores that previously offered this option to shoppers.
Openpay said that after their withdrawal from the UK they will still offer longer-term repayment plans for dental procedures and car repairs in the UK throughstrategic partnerships.
We'll look at how Openpay works in the UK and how it comes with other similar services.
Openpay allowed shoppers to split the cost of shopping purchases into equal monthly payments, with repayment periods ranging between two and nine months. Unlike other BNPL platforms, Openpay's payment terms vary by retailer so some may offer longer repayment terms than others.
Openpay is simple to use and offers a smooth checkout experience for online shoppers in the UK.
Here are some of the best features of Openpay:
Interest-free payments. Openpay almost works like an interest-free loan, allowing you to pay back your purchase in monthly instalments without interest.
Flexible credit. With Openpay you can borrow only as needed since you'll only use it when you complete a payment checkout process.
Fast application process. Applying for Openpay takes just a few minutes and you'll get a decision instantly.
No fees. As long as your payments are on time you will pay no fees.
Automatic payments. Openpay automatically deducts the agreed payment every month from your linked debit or credit card.
Payment reminders. Openpay will send you a payment reminder before every payment is due.
You won't have to pay interest on your outstanding balance because Openpay is interest-free.
Plans are free to use as well. If you don't make repayments on time, Openpay will impose a £7.50 late payment fee on you. A maximum of £15 is charged for each plan.
To sign up for Openpay you have to be at least 18 years old, have a valid UK ID, a valid email address, and a valid debit or credit card. You can register online on Openpay's website or by downloading the Openpay app from Google Play or the App Store.
Your new Openpay account is then connected to your Visa or Mastercard after you provide your basic information - contact details and credit or debit card details. Keep in mind that before approving your account, Openpay may perform a credit check. If accepted, you can start using Openpay immediately.
You can use Openpay at participating businesses in the UK once your Openpay account has been approved. You must pick Openpay as your payment method at the point of sale and use the app to choose from a variety of flexible payment plans.
Your initial payment with Openpay will be made at checkout, and it will be 20% of the price of your purchase. After choosing Openpay as your payment option, you'll get an instant decision from the app.
The remaining payments must then be made each month until your purchase is fully paid for. Your associated Visa or Mastercard will be automatically debited when a payment is due, and you can also use the Openpay app to make an early payment.
When you sign up for a new account, Openpay runs a credit check as part of their affordability assessments. As long as your payments are made on time it won't negatively affect your credit score.
Openpay will charge you a late payment fee of up to £7.50 if you don't make your payments on time (up to two days after the payment is due). A second fee may be added if the payment is overdue by more than 10 days, with a maximum amount of £15 per purchase.
It's best to call Openpay when a repayment is missed or when you anticipate having trouble making it in order to avoid this problem.
In the event that you do fall behind on your plan, Openpay may hire a debt collector to help them recover the money you owe.
As with most Buy Now Pay Later platforms, Openpay has many benefits to offer and a few drawbacks.
Some of their pros include interest-free instalment plans, reminders for upcoming payments, no early repayment charges, and flexible payment methods. You only pay the purchase price of the items you buy, with no interest, split over a few weeks or months.
As long as you stick with your monthly payment plan, you won't harm your credit score and you can even make an upfront payment to reduce your account balance, with no penalty fees.
Some of the downsides of Openpay include the late fees, as you'll be charged up to £7.50 for late payment. Also, Openpay conducts a credit check when you apply for a new account.
Openpay could be seen as a direct competitor to other BNPL companies like Klarna and Clearpay. However, as they will be withdrawing from the UK, shoppers can consider other payment options.
Openpay gives customers the option to select the payment option that best suits their needs. There are never any hidden fees or charges, and repayments are always interest-free.
But you should be aware of the late payment penalties. Contact Openpay as soon as you know you might have difficulties paying your instalments, to avoid additional charges and a mark on your credit record.