Afterpay accepts Amex! Tips to using a credit card with Buy Now Pay Later this Christmas

By Polly Fleeting ·

Planning to spread the cost of Christmas using Buy Now Pay Later (BNPL)? 

Well, just in time for the holiday spending season, credit card giant American Express has announced a new partnership with BNPL powerhouse Afterpay

According to Amex, customers can now use their credit cards to earn rewards points on Afterpay payments. All they need to do is set up their card as a payment option. 

The truth is, using your credit card for BNPL can be tricky business, so it’s important to know exactly how to manage your repayments and avoid further debt. 

5 tips to using Buy Now Pay Later with your credit card 

1. Avoid doubling up debt 

Remember, using your credit card to pay down your BNPL debts means you’re essentially using borrowed money to pay off more borrowed debt. So it’s important to have a repayment plan in order. 

While BNPL is interest-free, it’s unlikely that your credit card is. Make sure you pay down your credit card balance in full each month so that you aren’t charged interest on your BNPL spending. 

A tactic here could be to opt for a 0% introductory credit card offer, that way you won’t be charged interest on your BNPL spending for a certain period of time. 

2. Take advantage of rewards 

If you have a rewards credit card, you may be able to earn rewards points by using Buy Now Pay Later.

There is a golden rule when it comes to earning rewards points however: don’t overspend just to stack up on rewards. Only spend what you normally would at Christmas time, as accruing more debt for the sake of earning points won’t be worth it in the end.

3. Set up automated repayments 

Late fees aren’t fun, and many BNPL providers charge them if you don’t make your repayments on time. So the easiest way to avoid these fees is to set up automated repayments so you never miss a due date. 

The trick here is to remember to pay off your credit card as well. If you don’t pay at least the minimum amount on your credit card you may face another set of late fees. (Although, we suggest paying off your balance in full to avoid any extra costs!) 

4. Don’t be tempted to overspend 

At Christmas time it can be tempting to go spending crazy, but a little restraint goes far, especially when using your credit card on your Buy Now Pay Later purchases. 

The easiest way to avoid overspending is to create a budget. Allocate how much you wish to spend using BNPL, considering the full price of the items as well as how much you’ll need to pay for each instalment. Similarly, factor in repaying your credit card as well, as it is a two step process. 

If you are concerned about paying off both your BNPL and credit card, opting to use your debit card instead may suit you better. 

5. Be aware of your credit card’s limit 

Maxing out your credit card is never a good idea, whether you’re using it for Buy Now Pay Later or not. So be sure to stay under your credit card limit when Christmas shopping to avoid spiralling into uncontrollable debt. 

Remember, BNPL repayments are added to the balance on your credit card. So if you reach your limit, your future BNPL repayments could be declined, resulting in your facing late fees. 

Want to take advantage of a 0% intro credit card offer to use with Buy Now Pay Later? Check out these options below or head to our credit card comparison page for more.

Compare interest free credit card offers - last updated January 27, 2021

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^See information about the Mozo Experts Choice Credit Cards Awards

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