As ASIC eyes Afterpay, keep your credit card handy

Ben Tosi

21 Nov 2017

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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

  • Virgin Money Virgin Australia Velocity Flyer Card - Purchase Rate and Balance Transfer Offer

    0% p.a. for 6 months and then 20.99% p.a.

    0% p.a. for 14 months then 20.74% p.a.

    $129 $64 in the first year

    Receive a $129 Virgin Australia gift voucher each year. 0.0% p.a. on purchases for up to 14 months.

    • 0% p.a. for 6 months and then 20.99% p.a.

    • $129 $64 in the first year

    • 0% p.a. for 14 months then 20.74% p.a.

    • 44

    • Points are credited to the Velocity Frequent Flyer program.

    • 20.99% p.a.

    • 2.7%, Min $2.70

    Details Close

  • Apply By 30 April 2019

    Woolworths Everyday Platinum Credit Card

    0% p.a. for 14 months and then 21.99% p.a.

    19.99% p.a.

    $49 $0 in the first year

    Perfect for practical spenders, pay no annual fee in the first year and save up to $50 on your Woolies shop each month. Plus new cardholders can score a $50 Woolies eGift Card when you spend $150 a month for the first 3 months. Too easy!

    • 0% p.a. for 14 months and then 21.99% p.a.

    • $49 $0 in the first year

    • 19.99% p.a.

    • 55

    • Woolworths Money Shopping Card sent every 4 months if enough points have been accrued.

    • 21.99% p.a.

    • 3%, minimum $5

    Read our Mozo Review to learn more about the Everyday Platinum Credit Card

    Details Close

  • Bankwest Breeze Mastercard

    0% p.a. for 26 months and then 12.99% p.a. (2.00% balance transfer fee)

    0% p.a. for 6 months then 12.99% p.a.

    $79 $0 in the first year

    0% purchase rate for the first 6 months, then moving to 12.99% thereafter, great for consolidating debt. 0% p.a. on balance transfers for 26 months (2% BT fee applies)

    • 0% p.a. for 26 months and then 12.99% p.a. (2.00% balance transfer fee)

    • $79 $0 in the first year

    • 0% p.a. for 6 months then 12.99% p.a.

    • 55

    • 21.99% p.a.

    • 2%, Min $4.00

    Read our Mozo Review to learn more about the Breeze Mastercard

    Details Close

  • ANZ Low Rate

    0% p.a. for 15 months and then 21.74% p.a.

    12.49% p.a.

    $58

    With a low interest rate on your purchases and 0.0% p.a. on balance transfers for the first 15 months (T&Cs apply), this card makes for easy everyday spending. Apply online in just five minutes, and receive an answer in 60 seconds.

    • 0% p.a. for 15 months and then 21.74% p.a.

    • $58

    • 12.49% p.a.

    • 55

    • 21.74% p.a.

    • 2%

    Read our Mozo Review to learn more about the Low Rate

    Details Close

  • Apply By 30 April 2019

    Qantas Money Qantas Premier Platinum

    0% p.a. for 18 months and then 21.99% p.a.

    19.99% p.a.

    $299 $149 in the first year

    Receive 70,000 bonus Qantas Points when you spend $3,500 within 90 days of card approval, and an additional 30,000 bonus points after the first anniversary of the card. $299 per year. Special Offer- $149 annual fee for the first year, offer ends 30 April 2019.

    • 0% p.a. for 18 months and then 21.99% p.a.

    • $299 $149 in the first year

    • 19.99% p.a.

    • 55

    • Points are automatically credited to the Qantas Frequent Flyer program.

    • 21.99% p.a.

    • 3%, min $3.00

    Read our Mozo Review to learn more about the Qantas Premier Platinum

    Details Close

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