Tech

Sezzle Review 2024: Your Guide to Flexible Payments and Credit Building

By

Mohit Kamboj

Sezzle offers interest-free payment options for online and in-store shoppers, although it’s important to be aware of any potential fees.

Sezzle Pros and Cons

Pros Cons
  • Provides loans with no interest.
  • Comes with the added benefit of payment rescheduling at no extra cost.
  • Users have the option to take part in credit reporting.
  • Doesn’t send borrowers to collections.
  • There is a fee for reactivating your account.
  • Applies a fee for card payments.
  • We accept credit card payments for repayment.

A Look At Sezzle 

Loan Amount $35-$25,000.
Payment Structure Pay-in-four plan.
Interest 0%.
Availability Available online and in stores.
Conducts Soft Credit Check Yes.
Minimum Credit Score None.
Late fee No late fee.
Fees
  • Card payment fee: Up to $5.
  • Payment rescheduling fee: $0-$5 (up to $7.50 in some states).
  • Account reactivation fee: $10 (up to $15 in some states).
Option to Reschedule a Payment Yes.
Pauses Account When Payment is Missed Yes.

What is the Process of Sezzle?

  • Sezzle provides shoppers with a convenient pay-in-four payment plan. Under this plan, your balance will be split into four equal payments. The first payment is required at checkout, and the remaining three payments are due every two weeks until the loan is completely paid off.
  • As an illustration, let’s say you have a cart with a total of $200. If you choose Sezzle, you’ll make an initial payment of $50 at checkout, and then three more installments of $50 each, spread out over a period of six weeks. Following the initial payment, subsequent installments will be charged to the same debit or credit card or withdrawn from your bank account if you choose that method.
  • Sezzle does not apply any interest to its pay-in-four plan. However, there may be additional charges such as a card payment fee, an account reactivation fee, or a rescheduling fee. We will discuss these fees in more detail later.

Other Payment Options

  • Sezzle provides an alternative payment option where you can split your purchase into two installments. The first half is due at checkout, and the second half is due two weeks later. This allows for more flexibility in managing your payments.
  • Sezzle offers monthly financing with terms that range from three months to four years, making it simple to understand and choose the right option for you. These longer payment plans may come with interest charges, ranging from 5.99% to 34.99% APR, although there may also be 0% APR offers.

Is Sezzle a Beneficial Idea?

Deciding whether or not to use Sezzle will depend on your individual financial circumstances. Consider the advantages and disadvantages below to determine if it’s a suitable choice for you.

  • Sezzle offers pay-in-four and pay-in-two options for splitting up purchases without any extra charges. This is a rare feature in traditional credit products, particularly those that don’t require a minimum credit score.
  • Sezzle allows you to easily reschedule one payment per order at no cost, giving you the flexibility to delay payment for up to two weeks. Some BNPL lenders may not provide this level of flexibility, potentially resulting in missed payments and account deactivation. With Sezzle, you have the flexibility to reschedule your order up to three times. However, please note that there is a $5 fee for the second and third reschedules.
  • Sezzle shoppers have the option to participate in Sezzle Up, allowing Sezzle to report their payment history to Equifax, one of the three major credit bureaus. This unique advantage, which is not commonly found among BNPL lenders, can assist you in establishing credit by demonstrating a track record of punctual payments to your Sezzle account. On the other hand, credit can be negatively impacted by late payments.
  • In order to be eligible for Sezzle Up, you’ll need to ensure that you make timely or early payments on at least one purchase, connect your bank account, and provide the necessary information, such as your Social Security number.
  • Sezzle stands out from other BNPL providers by not sending past-due borrowers to collections agencies. Collection activity on your credit report typically has a negative impact on your score, while the impact of BNPL debt on credit is not as well-defined.

About ‘buy now, pay later’

  • Most retailers now offer the option to use “buy now, pay later” when checking out. It’s crucial to carefully review the loan terms offered at checkout as they vary depending on the BNPL provider, including the type of payment plan and any associated interest or fees.
  • For certain users, BNPL can be a convenient method to divide a purchase, particularly when you receive a zero-interest offer and are confident in your ability to manage the installments. Getting approved may be more accessible compared to credit cards or loans since there is no minimum credit score requirement.
  • However, BNPL still involves a level of debt and carries certain risks. In September 2022, the Consumer Financial Protection Bureau published a study highlighting concerns regarding the lack of consistent consumer protections, the potential for accumulating debt and overspending, and the collection and monetization of personal data. In a study conducted by the CFPB in March 2023, it was found that individuals who use BNPL services are more prone to displaying indications of financial hardship.

Pros and Cons of “Buy Now Pay Later

Pros  Cons
  • Zero-interest plans available.
  • No minimum credit score required.
  • Available at most major retailers during checkout.
  • Interest may be charged by certain plans.
  • There may be fees associated with certain plans.
  • Payments might not be reported to the three primary credit bureaus.
  • Spend too much.
  • Dealing with disputes and returns can sometimes be a bit difficult.

How to Get Approved for Sezzle?

In order to qualify for Sezzle, you must meet a few requirements. Firstly, you must be at least 18 years old. Additionally, you will need to have a U.S. or Canadian phone number that is capable of receiving text messages. It is also necessary to verify your email address and have a payment method available, such as a debit or credit card.

The company claims that approval decisions are made instantly, and you will be given an initial spending limit based on what Sezzle deems you can comfortably repay. By consistently making timely payments, your credit limit should see an increase.

How to Get Sezzle App?

For a seamless shopping experience with Sezzle, simply download the Sezzle app. Creating an account, checking your approved credit limit, and shopping at partner stores can all be done conveniently through the app.

After setting up a Sezzle account, you’ll gain access to the Sezzle Virtual Card, which can be used at Sezzle’s partner stores. This card can be used as a convenient payment method for online purchases on websites such as target.com. Additionally, you have the option to save the card to your mobile wallet and conveniently use it for in-store purchases.

Conclusion

In summary, Sezzle offers a user-friendly buy now, pay later (BNPL) solution, allowing interest-free payments for online and in-store shoppers. While providing flexibility, users should be mindful of potential fees. Sezzle’s unique features, including payment rescheduling and credit-building opportunities, make it a beneficial choice for those seeking convenience. However, understanding terms and fees is crucial for a seamless experience. With Sezzle’s instant approval process and a dedicated app, it’s a straightforward option for hassle-free shopping.