What is Payright and how does it compare to Afterpay?
The buy now, pay later (BNPL) market is experiencing a bit of a boom. Aussies have come to appreciate the convenience and affordability of post-pay services, and merchants have waxed fanatical about speedy turnovers. Touted as an interest free alternative to a credit card, they're whipping Aussies into a spending frenzy.
And while it’s fair to say the Buy Now Pay Later market in Australia is currently dominated by Afterpay, there’s been no shortage of challengers making waves as of late. One that's grabbed our attention is a platform called Payright.
Founded by two brothers, Myles and Piers Redward, Payright is positioning itself as the classier alternative to Afterpay.
In 2019, the company managed to raise $30 million in capital to grow its operations. And in April 2022, it signed a $125 million warehouse lending facility with Goldman Sachs.
But what exactly is Payright, and how does it stack up to Afterpay? Let’s take a look.
What is Payright?
Payright operates much like other buy now, pay later services, allowing customers to spread the cost of purchases across a number of small, manageable instalments.
Unlike similar services, however, Payright is geared towards larger, more considered purchases, such as renovations, education, and health expenses (rather than, say, a pair of sneakers or a new phone).
To that end, users will be able to borrow up to $20,000, considerably higher than the maximum single purchase of $1,500 offered by Afterpay.
How does it work?
When you make a purchase using Payright, you’ll have to submit an application form and enter into a Credit and Repayment Schedule. This will lay out the amount of credit available for the purchase, the size and frequency of repayments, and the types of fees that you can expect.
You’ll pay an initial deposit, after which a payment plan will be set up to cover the rest. The deposit is usually 10% but you can choose to pay more if you want to.
You can choose to make your payments fortnightly or monthly, and repayment dates are chosen by you during the application.
On the merchant’s end, Payright deposits the full amount of funds to their account at the time of the transaction (minus a merchant's fee). The big advantage for businesses is that this allows for increased cash flow, as customers who might have been on the fence about purchasing a particular item might have fewer reservations if payment is spread out over time.
How do I apply to use Payright?
Signing up for Payright is actually not that different to applying for a credit card. Signup can be completed online, via teh Payright app, and even in store at a participating merchant. It only takes a few minutes and you can expect to receive a decision shortly after. To apply, you’ll need to tick the following boxes:
- You must be over 18 years old
- You must be an Australian citizen or permanent resident
- You must be deriving an income
Being accepted won’t come so easy though. Payright is committed to responsible lending, and since it typically focuses on larger ticket consumer financing, the application process is slightly longer compared to other micro-ticket Pay-In-4 BNPLs including Afterpay.
Besides basic ID and contact details, Payright will also require some information about your financial background and employment. Here are the main things you’ll need to provide:
- A valid Australian drivers licence or Australian passport
- A suitable credit or debit card
- If employed, your employment details
You’ll only be accepted if the company can confidently say you’re capable of keeping up with repayments. This entire process might seem gruelling compared to similar services, but it makes sense considering Payright is designed for larger purchases.
If you’re approved, Payright will send you a notification and your Payright account will be activated and ready to use immediately.
Quick questions
Are there any fees and charges?
While you can be confident you won’t have to pay any interest on purchases you make, there are a few charges that come with using Payright. These include an establishment fee of up to $89.95 and a monthly account keeping fee of $3.50. Plus you’ll be charged a payment processing fee of $2.95 for each payment.
Is Payright secure?
Payright complies with all the usual industry regulations when it comes to keeping users’ information secure, but make sure you read the terms of use page so you know exactly what you’re signing up for. Information is mainly collected for assessment and account management purposes, and you can request a copy of the information that Payright has about you at any time.
How many payment plans can be held at once?
Payright allows you to have have a second payment plan provided you have made three successful repayments on your first plan, with account keeping and establishment fees charged only once but with a $19.95 repeat purchase fee..
What can I buy with Payright?
You can take out a Payright loan from $1 to $10,000 for purchases at any business in our merchant network. Loans from $10,001 to $20,000 are provided exclusively for purchases from merchants in the home improvement category.
How do refunds work?
If the shop you’ve purchased from accepts refunds and you opt to return an item you bought using Payright, any payments you’ve already made will be returned and all upcoming payments will be cancelled. Unfortunately, processing fees won’t be refunded.
Are there late fees?
Yes, Payright will charge $12.95 for any late payments. That said, you can expect to receive reminders of any upcoming repayment dates, so it shouldn’t be too hard to keep on top of things. If, however, your circumstances change and you need to arrange a late payment, you’ll need to call or email Payright. Missed payments will have to be made within 7 days otherwise you’ll have a default on your hands.
What if I can’t make my repayments?
If your repayments are proving to be a bit more than you can handle, you can always adjust the amount and frequency. But if you’re really struggling, you should contact Payright as soon as possible so a solution can be devised that works for both you and them.
Does Payright affect my credit score?
When you apply for a Payright account, you'll be entering into a continuing credit contract - which is the same thing you get when applying for a credit card. Given that, you should approach it with the same level of caution, and expect it to affect your credit history in much the same way as well.
That means if you manage your payments responsibly you should have nothing to worry about, but missed repayments or a default could leave you with a black mark on your credit report. A Payright account can also be considered a potential expense when you're applying for a home loan, personal loan or credit card, which could impact your borrowing power.
| Payright | Afterpay | Credit card | |
|---|---|---|---|
| Maximum amount | $20,000 | $1,500 | Your credit limit will depend on how much your bank thinks you can reasonably pay back |
| Late fees | $12.95 | For orders below $40, a maximum of one $10 late fee may be applied per order. For orders of $40 or above, the total late fees that may be applied are capped at 25% of the original order value or $68, whichever is less. | Average $19.60 among providers we track. Credit card late fees are often either a flat dollar amount, or a percentage of your balance. |
| Repayments | Made fortnightly or monthly | Four instalments made over six weeks | Can be made at any time, but your bill comes monthly. Interest applies if your balance isn’t paid in full by the payment due date |
| Eligibility criteria | You must be over 18 years old, an Australian citizen or permanent resident, and deriving an income | You must be over 18 years old and an authorised holder of an eligible debit or credit card | You must be over 18 years old, an Australian citizen or permanent resident, earning enough to pay the max credit limit on the card, and have a good credit score |
| Affects your credit score | If you are unable to keep up with repayments, then you could see this reflected on your credit score. | It’s complicated. Afterpay says it doesn’t affect your credit score, and it doesn’t, at least not directly. But if you’ve linked your credit card to your Afterpay account and you fail to pay off your credit card bill, your credit score will take a hit. On top of that, you should know that many banks are now going so far as to scrutinise personal Afterpay habits when assessing home loan applications. | Yes. A credit card is a direct line of credit. If you fall behind on your repayments, your credit score will suffer. |
| Where is it accepted? | Participating merchants (online and in-store). This includes dentistry, photography, cosmetics, jewellery, musical instruments, beauty, cruises, fitness, tutoring, electronics, solar installations, plumbing, home security, furniture and accessories, and more. | Participating merchants (online and in-store). This includes clothing, footwear, lingerie, make-up, jewelry, beauty and wellness, art, toys, health foods, beds and furniture, and more. Afterpay is supported by big brands as well as small, independent merchants. | Most credit cards work on the Visa, Mastercard or Amex networks, which are generally available in most stores all around the world. |
Now that you’ve read up on the details of Payright, you can make a call on whether or not it's right for your spending.
But if you’d rather stick with a trusty credit card, you’ll be glad to hear there are plenty of interest free options available. Check out our interest free credit card comparison page for help picking out the right one or our best credit cards page.
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