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Pay in 4 and pay monthly

In recent years, the rise of buy-it-now, pay-later services has made it easier to complete a purchase and pay it off in small, manageable installments. We’ve seen companies including Affirm, Klarna and Afterpay come to the fore with flexible payment options.

However, major players, such as PayPal, are not keeping quiet. PayPal Pay in 4 and Pay Monthly are also here to conquer your wallets.

In this PayPal Pay in 4/Pay Monthly review, we look at the fintech company’s offerings to buyers and whether they’re enough to compete with the more recently established buy-it-now, pay-later options.

What are PayPal Pay in 4 and PayPal Pay Monthly?

Shoppers have used traditional line of credit offers, such as credit cards and personal loans, to fund their purchases. Buy Now, Pay Later services aim to make it easier for customers to walk away with same-day purchases while having little to no impact on their credit score or credit report.

Available with supported online reseller partners, PayPal buy now, pay later allow you to choose one of two installment payment options at checkout. Buyers can use the company’s Pay in 4 interest-free or Pay Monthly financing options.

PayPal Pay in 4 will allow you to fund a purchase between $30 and $1,500 in four interest-free installments through your bi-weekly paid bank account. The first payment is due at checkout, with the remaining three installments due every two weeks.

Alternatively, shoppers can select PayPal’s Pay Monthly service for qualifying purchases between $199 and $10,000. This option will allow buyers to pay for their purchase in monthly installments over 6, 12 or 24 months. Interest will apply with an APR between 9.99% and 29.99%.

How do PayPal’s Pay in 4 and Pay Monthly offers work?

To start shopping with PayPal’s “buy now, pay later” offers, you’ll need to shop at a supported retailer. Some major retailers that offer such financing include Best Buy, Nike, Dillard’s, Target, The Home Depot, Fossil, and Ace Hardware.

It is essential to note that the PayPal Buy Now, Pay Later service is not available in store and can only be used online. This makes it one of the least flexible buy now, pay later services we’ve reviewed.

Shopping with PayPal Pay in 4/Pay monthly

To get started, visit the website of one of the supported retailers. Shop as you normally would, adding the products you want to your cart. When you’re ready, head to your shopping cart to begin the PayPal checkout process.

Select PayPal as the payment method. If you have a PayPal account, you will be prompted to sign in; otherwise, you will need to create an account.

If your purchase is eligible for PayPal Pay in 4 and Pay Monthly financing, you will see Pay in 4 and Pay Monthly available as PayPal payment options. Select one of these two choices to begin the payment process with financing.

Once you have selected your PayPal funding option, you may be prompted to enter your personal information to complete the verification process. Neither PayPal service will initiate a rigorous credit check, leaving your credit score intact; a soft credit check is performed.

If approved, you may be asked additional questions. For example, with PayPal Pay Monthly, you will have to choose between different payment terms (six months, 12 months or 24 months). Select the one that suits you best.

Download the app and manage your purchases

When your purchase has been finalized, keep up to date with the required installment payments. You can log in to the PayPal site, but we recommend downloading the PayPal app so you always have the information at your fingertips.

You can view detailed information, including outstanding payments, on any PayPal Pay in 4 or Pay Monthly loan in the Pay Later section of the PayPal app. In-progress purchases will appear under active plans, while paid-off loans will appear under plan history.

We especially like that PayPal includes purchase protection with every buy now, pay later. As a result, you won’t have to worry about having your money stolen or receiving a faulty product when shopping – PayPal has your back.

Additionally, PayPal does not charge sign-up or late fees for using its financing offers.

Alternatives to PayPal Pay in 4/Pay Monthly

PayPal offers a decent entry into the buy now, pay later financing space, but it’s not perfect for everyone’s needs. Shoppers who want to make in-store purchases will need to find another option, as well as individuals buying from unsupported retailers.

Other services Buy now, pay later

There are several other buy-it-now, pay-later services. We reviewed several, including Klarna, Affirm, Afterpay, and Sezzle. Here’s how some of the most popular options stack up with PayPal Pay in 4 and Pay Monthly:

Buy now, pay later Services compared

Features PayPal To affirm Klarna After-payment

Payment schedule

Pay in 4 and pay monthly financing

Affirm Pay in 4 (every 2 weeks) or monthly funding

Pay in 4, Pay in 30 days & monthly financing

First of 4 payments immediately, then every 2 weeks

Interest rate

0% on Pay in 4; 9.99% to 29.99% on monthly pay

0% on Affirm Pay in 4; 0% to 30% per month

0% for Pay in 4 and Pay in 30 Days; 0% to 25% per month

0% interest

Late fee

No late fees

No late fees

Up to $7 on Pay in 4; up to $35 per month

$10, followed by $7 if payment is not made

Effect of credit score

Flexible credit check

Flexible credit check; can report history to Experian

Flexible credit check for Pay in 4 and Pay in 30

No credit check

where it is accepted

Select online retailers

Anywhere online and in-store with wireless payment

Everywhere online and select in-store retailers

Select online and in-store retailers

Additional PayPal Alternatives

If a “Buy Now, Pay Later” service doesn’t seem right for your shopping needs, you might want to consider a more traditional option. Personal loans and low-interest credit cards are two ways to make purchases when you don’t have all the funds on hand.

We have a selection of the best personal lenders available for those who wish to take this route. If you’re entirely new to personal loans, check out our step-by-step guide to getting a personal loan.

For those considering a credit card but not feeling confident in their decision-making process, check out the free Credit Card 101 course at Penny Hoarder Academy.

The Advantages and Disadvantages of PayPal Buy Now, Pay Later


  • Interest-free loans are available for shoppers who want to pay off their purchases with bi-weekly payments.
  • No late fees are imposed if you are late on your payments.
  • Purchase protection is included with every financing option.

The inconvenients

  • There is no option at this time to defer your payments if necessary.
  • Interest rates are subject to change depending on the creditworthiness of the individual borrower, with APRs of up to 29.99%.
  • Purchase is only available at select online retailers.

Frequently Asked Questions (FAQs)

How can I benefit from the PayPal Buy Now, Pay Later service?

To be eligible for the PayPal Buy Now, Pay Later service, you must be at least 18 years old and have a PayPal account in good standing. If you don’t have a PayPal account, you’ll need to open one to apply for funding.

States not included in the program include Missouri, Nevada, New Mexico, North Dakota and Wisconsin and all US territories.

What credit score do you need to pay later with PayPal?

PayPal does not specify a minimum credit score for use of its Buy Now, Pay Later services; however, the company performs a soft credit check to determine your creditworthiness.

You can see the PayPal credit at checkout; it is a different offer from PayPal’s buy it now and pay later options. Selecting PayPal Credit will result in a credit check, as this is a traditional line of credit.

Michael Archambault is a senior technology writer for The Penny Hoarder.