If you are familiar with online transactions in any shape or form, it’s likely that you’ll have a PayPal account. After all, the online payment service is used by nearly 250 million users worldwide and is the preferred option for many retailers and consumers alike. But did you know that purchases don’t have to be paid for immediately? Thanks to PayPal Credit, it is possible to spread the payments!
It’s a feature that’s loved and used by millions of sellers and buyers. Here’s an introduction to what PayPal Credit is and how it can be used for both buyers and sellers.
PayPal Credit At A Glance
Perhaps the easiest way to explain the PayPal Credit system is to look at it as a fusion of two common forms of existing credit:
- Credit Cards
- Store Accounts.
PayPal Credit works a bit like a store account in that you do not possess a physical credit card that can be used for purchases. Instead, users have a separate credit account that is held by PayPal and is paid off through (manual or automated) monthly payments.
However, it also works like a credit card in the sense that the account is not limited to one store. PayPal credit can be used with any vendor that accepts PayPal as a payment type. PayPal takes on the risk of the loan, while the seller gets their funds immediately.
This makes it a unique credit line that is used by millions every single month.
How Does PayPal Credit Work?
PayPal Credit is available on purchases of $99.00 or more while users have a period of time to clear the credit amount on an interest-free basis.
Applicants will need to go through a credit check before PayPal confirms opening the line of credit – thankfully, their requirements are less strict than many other credit agencies.
For the consumer, using PayPal Credit is as easy as 1-2-3:
Step One: Add products to the basket and head to the payment checkout with their chosen retailer.
Step Two: Choose PayPal Credit, log in, and submit the instant application before confirming the purchase.
Step Three: Use the following months to meet the minimum repayments and clear the total balance. For retailers, embracing the Buy Now, Pay Later scheme requires no additional effort.
As long as the e-commerce platform processes PayPal as a payment type, the business can accept the payments from the online company – the relationship between the end customer and the line of credit is almost irrelevant.
Why Is PayPal Credit So Popular?
In addition to its ease of use, PayPal Credit is popular with merchants and consumer for many reasons.
Merchants and retailers find that this is the perfect way to offer Buy Now, Pay Later without the risk of bad credit or poor cash flow. Moreover, the fact that no additional investments of time or money are required is hugely beneficial.
For the consumer, the no interest period scheme is a far better option than using credit cards. Likewise, the instant nature of applying for credit is a winner. Finally, using PayPal Credit ensures that all parties are protected by the same features offered by standard PayPal payments.
PayPal for WooCommerce and PayPal Credit
Need Additional Help?
Schedule a live meeting with Drew Angell, PayPal Certified Developer, and get all of your questions or concerns answered.