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Pay Later Solution: Is it the End of the Credit Card Era?

 

Pay Later has arrived and it's shaking up the credit card industry. Pay Later is a unique financial product where you can buy now pay later. It is designed to offer consumers the convenience of shopping with credit while protecting them from paying for goods they don't need or can't afford.

Instead of a credit card, Pay Later users use their debit cards like a credit card. Just swipe and sign for purchases at any time. It is safer than relying on your bank account because your balance will never be more than $250 (or the limit set by your debit card issuer). If you exceed that money, the merchant won’t process payment.

Pay Later was designed to replace credit cards. It enables sellers to build a more stable bottom line and make it easier to offer customers low introductory prices.

"Just as some gas station owners have found, once you've started offering Pay Later, people buy more with it." says Darrell Davis, CEO of Pay Later. "A lot of people don't want to buy a car until they see the sticker price or have a credit check on their credit report. Pay Later lets shoppers buy their car, furniture, clothes or anything else on sale without having to wait or leave their house."

The convenience of Pay Later has made it a viable option for merchants to replace credit cards as well. By replacing the credit card with a Pay Later option, merchants can avoid the high fees and risk of chargebacks. They can also expand the number of customers they reach.

For example, Pay Later is becoming a popular alternative to other popular deals like “Buy a Car on Layaway,” or “Get Your Doctor's Exam Free with Pay Later.”

The arrival of Pay Later has created an entirely new financing option for consumers and is shaking up the credit card industry. At Pay Later, consumers pay for an item online with a credit card like they always have. Then, they simply "use" the item. The merchant accepts the payment without charging customers any interest or fees.

This is no different than paying cash with your debit card(s). Today's debit cards are the same as credit cards and you can use them at any time. The only difference is that if you use a debit card to buy an item on layaway, it is considered deferred payment.

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