As ASIC eyes Afterpay, keep your credit card handy

Ben Tosi

21 Nov 2017

redactor/hero-images/185/Eyes_FINAL_content.jpg

Aussie regulatory giant ASIC announced that it would be keeping a close eye on “buy now, pay later” schemes like Afterpay on Friday, which might make you nervous. Fortunately, the good old credit card is always there to fall back on.

Similar to the lay-by of yesteryear, payment platforms like Afterpay allow Aussies to purchase their favourite retail goods (and take them home immediately) for a smidge of the actual cost, with the rest paid off in fortnightly instalments.  

But now regulators have their eye on the platform, looking to see whether it is as good as we all think it is.

“ASIC is currently monitoring this industry and engaging with both industry participants and consumer groups,” said ASIC senior executive, Michael Saadat.

“We plan to collect data from buy now, pay later providers in the first quarter of 2018 to determine the size and demographics of the industry and participants, as well as to identify any consumer harms."

RELATED: Love Afterpay? Here are the traps you should know about

These kinds of payment methods have taken hold in Australia this year. In September, Afterpay announced it was now responsible for processing 20% of total online fashion retail and planned on being in over 4000 physical shop fronts come Christmas.

Part of what makes Afterpay so popular is that it doesn’t charge you any interest for your purchases, just a $10 late payment fee, which grows to $17 if you leave it longer than a week.

While this might seem like a great thing for Aussies who don’t want to pay the full price right away but also can’t stand the thought of costly interest charges, it also means that the company operates outside of credit consumer laws, so it isn’t really regulated.

RELATED: The 9 credit card perks you forgot (or didn’t know) you had

But regulated options still exist for savvy shoppers who don’t want to pay the bulk of their Christmas haul upfront. For example, interest free credit cards, when used responsibly, can provide a lot of the same benefits as these buy now, pay later payment options.

“If you’re clever with your credit card payments you can use your piece of plastic for the Christmas shopping haul, making the most of the interest free days that it offers and avoiding new year interest charges on your bill,” said Mozo Director, Kirsty Lamont.

But it isn’t just the interest free aspect of Afterpay that is attractive for Aussies. If you’re keen on having a fixed payment plan to make sure you pay off your spending but would rather stick with  plastic, there are options on the market, like the ING Orange One card which features an option to pay for larger purchases via instalments, albeit at a 9.99% interest rate.

Check out a popular bunch of interest free credit cards in the table below or read up on how to best use your credit card for the Christmas shopping spree with our credit cards for shoppers guide.

Interest free credit cards for you

Rates updated daily. Advertiser disclosure.

  • Westpac Low Rate

    0% p.a. for 24 months and then 21.49% p.a. (1.00% balance transfer fee)

    13.74% p.a.

    $59

    Enjoy 0% p.a. interest on balance transfers for the first 24 months. Get $200 cashback with $1k minimum spend on eligible purchases within 90 days of card approval. 55 interest free days and low on-going rate of 13.74% on all purchases.

    • 13.74% p.a.

    • -

    • 0% p.a. for 24 months and then 21.49% p.a. (1.00% balance transfer fee)

    • 21.49% p.a.

    • 55

    • 3.00%

    • $59

    • $15.00

    • 2%, Min $2.50, Max $150

    Read our Mozo Review to learn more about the Low Rate

    Details Close

  • St.George Vertigo

    0% p.a. for 24 months and then 21.49% p.a.

    13.99% p.a.

    $55 $0 in the first year

    0% p.a. for 24 months on balance transfers requested at card application. No balance transfer fee. Rate then switches to applicable variable cash advance rate. First year annual card fee waived for the first year ($55 thereafter). Available to new cards only, Eligibility criteria and T&Cs apply. Offer ends March 2nd 2021. Mozo Experts Choice Balance Transfer Credit Card Winner 2020^.

    • 13.99% p.a.

    • -

    • 0% p.a. for 24 months and then 21.49% p.a.

    • 21.49% p.a.

    • 55

    • 0.0

    • 3.00%

    • $55 $0 in the first year

    • $15.00

    • 2%, Min $2.50

    Read our Mozo Review to learn more about the Vertigo

    Details Close

  • St.George Amplify Platinum

    0% p.a. for 15 months and then 21.49% p.a. (1.00% balance transfer fee)

    19.74% p.a.

    $99

    Earn 70,000 bonus Qantas Points (min $1,500 spend each month for 3 months). New cards only, Eligibility criteria and T&Cs apply. Offer ends 2nd March 2021.

    • 19.74% p.a.

    • -

    • 0% p.a. for 15 months and then 21.49% p.a. (1.00% balance transfer fee)

    • 21.49% p.a.

    • 55

    • 3.00%

    • $99

    • $15.00

    • 2%, Min $2.50

    Read our Mozo Review to learn more about the Amplify Platinum

    Details Close

  • BankSA No Annual Fee

    0% p.a. for 12 months and then 21.49% p.a. (1.00% balance transfer fee)

    20.74% p.a.

    $0

    0% p.a. for 12 months on balance transfers requested at card application (1% balance transfer fee applies). Rate then switches to applicable variable cash advance rate. New cards only. Eligibility criteria and T&Cs apply. Offer ends 2 March 2021.

    • 20.74% p.a.

    • -

    • 0% p.a. for 12 months and then 21.49% p.a. (1.00% balance transfer fee)

    • 21.49% p.a.

    • 55

    • 3.00%

    • $0

    • $15.00

    • 2%, Min $2.50

    Read our Mozo Review to learn more about the No Annual Fee

    Details Close

  • NAB StraightUp Card ($10/month - $1,000 Credit Limit)

    No current offer

    0% p.a.

    $120 $10/month - waived if no spend & no balance owing

    Pay no interest and no late payment fees, just a $10 monthly fee for a $1,000 credit limit. Plus, if you don't make any purchases and have an outstanding balance of $0 during the whole statement period, the monthly fee will be reversed. Also pay no foreign currency fees when you shop online or overseas. Mozo Experts Choice Credit Card Innovation Winner 2020^.

    • 0% p.a.

    • -

    • No current offer

    • 0

    • 0%

    • $120 $10/month - waived if no spend & no balance owing

    • $0.00

    • n/a

    Read our Mozo Review to learn more about the StraightUp Card

    Details Close

^See information about the Mozo Experts Choice Credit cards Awards