Afterpay VS Layby | The Negotiators (Debt Negotiation Services)

Afterpay VS Layby

September 13, 2020

how afterpay and layby works

What are Layby and Afterpay?

Afterpay and Layby both have the same basic function which is extending a line of credit to users.

Afterpay charges you in 4 payments over 8 weeks, so a quarter payment every fortnight. 

Layby splits the purchased item into 6 payments which due weekly. It is a tight payment schedule with more regular payments from your savings.


Comparison between Layby and Afterpay.

In comparison with Afterpay, you get the goods to deliver to you. You can also purchase them at the in-store. Whereas in a layby, you will get the goods when you make the last installment amount due (final payment).

Layby- uncountable Australian method of buying goods from the shop by paying a small amount of money so that the shop can hold the goods for them until they pay the rest amount.

Layby was popular among the consumer during the big sale events like toy sale and mid-year sales, before the launch of Afterpay in Australia in 2015.

Before 2015 consumers used to buy goods through layby to avail the same discounts and payback in installments without attracting any interest in layby purchase.

It only used to have an administration charge of $2.50 per layby. Also, if you wish to cancel the layby it was a simple process and consumers get the full money back. They have to pay a small amount of admin fees.

We are now in a generation, where people want the goods straightaway, hence Afterpay is a preferred option for consumers and retailers as both to get the benefit on the spot.

It doesn’t charge any interest to use the service, it does cost you if you start missing payments.

You’ll pay an extra $8 and your account will get frozen when you fail to make a payment, meaning that you can’t use Afterpay as a payment method for anything new until you settle the due amount.


How to get approve Afterpay?

Since, Afterpay is not a bank, loan company, and a credit union, you don’t need to approve for an account like you would get a credit card or personal loan.

The only criteria are that you must be 18 years old and over. You must have a credit or debit card you can link to your account.


What are the benefits?

The benefits of using Afterpay are there but it comes with a catch when you apply for a new bank loan, banks and lenders while processing your new loan application will consider your spending habits and your commitments which affects your borrowing capacity.

It shows to your prospective lender whether you (customer) will be able to afford the new loan based on existing spending habits as part of BCOP it is an obligation of a credit provider to take into consideration all financial commitments of a consumer and to not offer a product which will be “unsuitable” for them and put them into financial hardship.


Still, Tempted to use an Afterpay option?

Consider this next time before you are tempted to sign in to Afterpay and make a purchase!

In addition to the above, if you have over-committed yourself with loans and other debts. These bets are making your life stressful and affecting your professional and personal relationships.

Get help from a professional

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