Interest free offers

Retailers selling products such as white goods or furniture may offer you interest free deals to buy now and pay later. Before signing up for these deals, it’s important to understand the amount and frequency of payments you’ll need to make to pay the product off before large interest payments apply.

Look out for high interest rates

Terms and conditions for buy now pay later offers can be complex and may include high interest rates that start from a certain date if you haven’t fully paid for the product.

The regular payments you’ll need to make to pay off the product before you are charged high interest rates may be very different to any minimum payment price the business advertises or quotes you.

Before signing the agreement

Before signing up, read the terms and conditions carefully and check the following:

  • the nature of the interest free offer
  • details about the interest free period, such as the date it expires
  • the annual percentage interest rate or rates you’ll have to pay if you haven’t paid off the product by the time the interest free period expires
  • the date the annual percentage interest rate or rates will apply from
  • the amount of any other fees and charges.

Work out your payment amount

Work out how much you would regularly have to pay to ensure you could pay off the product before interest rates apply. Make sure your regular payments use this amount and not the suggested minimum.

Keep copies of all agreements, receipts, invoices and statements in case something goes wrong.

If you think you have been wrongly charged or misled

Make a consumer complaint

More information

Entering into a contract
MoneySmart's interest free calculator

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