What Perpay is and how it works
Perpay is a buy-now-pay-later service that lets you purchase items from partner retailers and pay for them in installments over time, rather than all at once. You don't receive a traditional credit card in the mail. Instead, you use the Perpay app or website to browse and buy from stores like Target, Walmart, and Amazon, then split the cost into multiple payments spread across weeks or months.
When you make a purchase through Perpay, the company pays the retailer upfront on your behalf. You then repay Perpay through automatic payments deducted from your bank account on a schedule you agree to. The payment plan typically divides your purchase into equal installments, often with no interest charged if you pay on time.
Perpay reports your payment history to credit bureaus, which means on-time payments can help build your credit score, and missed payments can harm it. This differs from some other buy-now-pay-later services that do not report to credit bureaus at all.
Key Takeaways
- Perpay lets you buy from partner retailers and pay in installments through the app, with no physical card issued to you.
- Payments are automatically deducted from your bank account on a schedule you choose, and on-time payments are reported to credit bureaus.
- You may face late fees if you miss a payment, and Perpay can attempt to collect the debt if your account falls behind.
- Perpay performs a soft credit check when you sign up, which does not lower your credit score, but missed payments will show up on your credit report.
- The service works best if you have a stable income and can commit to the payment schedule, since breaking the agreement can damage your credit.
How to set up a Perpay account
To start using Perpay, you download the app or visit the website and create an account with your email address and password. You will need to provide your full name, date of birth, and the last four digits of your Social Security number so Perpay can verify your identity and check your credit history.
Perpay performs a soft credit inquiry, which means the company looks at your credit report but does not make a hard pull that would lower your credit score. You will also need to link a bank account where Perpay can withdraw your payments. The company verifies the account by depositing and withdrawing small amounts, usually within one to two business days.
Once your account is set up and verified, you can browse items available through Perpay's partner retailers. Not every product at every store is available through Perpay — the service limits which items you can purchase on their platform.
Payment plans and how much you pay
Perpay typically offers payment plans that range from four to twelve weeks, though the exact length depends on the purchase amount and what Perpay determines you can afford. The company divides your total purchase into equal installments and deducts each payment automatically from your bank account on the dates you agree to.
If you pay all installments on time, you usually pay no interest. However, Perpay may charge a late fee if you miss a payment — the amount varies but is typically between $10 and $35 per missed payment. If you fall significantly behind, Perpay may refer your account to a debt collector, which can appear on your credit report and affect your ability to borrow money in the future.
Before you complete a purchase, Perpay shows you the exact payment schedule and total cost, so you know what you are committing to before you confirm the order.
How Perpay affects your credit score
Perpay reports your account activity to the three major credit bureaus — Equifax, Experian, and TransUnion — which means your payment history with Perpay becomes part of your credit report. On-time payments can help build your credit score over time, since payment history makes up about 35 percent of most credit scores.
Missed or late payments are also reported to these bureaus and will lower your credit score. A single missed payment can drop your score by 50 to 100 points or more, depending on your current score and credit history. If your account goes to collections, that negative mark stays on your credit report for seven years.
The soft credit check Perpay does when you sign up does not hurt your score, but the ongoing reporting of your payment behavior does. This makes Perpay different from some other buy-now-pay-later services that do not report to credit bureaus at all.
When Perpay might not be the right choice
Perpay works best if you have a steady income and can commit to the payment schedule without missing dates. If you are uncertain whether you can afford all the installments, or if you have a history of missed payments, taking on a Perpay obligation could damage your credit further.
Perpay also limits which items you can purchase — not all products at partner stores are available through the service. If the item you want is not offered through Perpay, you cannot use the service to buy it, even if the retailer is a partner.
Additionally, Perpay charges late fees and can refer accounts to debt collectors, which means the consequences of missing payments are real and can follow you. If you are already struggling with debt, adding another payment obligation may not be wise.
Perpay versus other buy-now-pay-later services
Several other companies offer similar buy-now-pay-later services, including Affirm, Klarna, and Afterpay. The main difference between Perpay and many competitors is that Perpay reports to credit bureaus, while services like Afterpay typically do not. This means Perpay can help build your credit if you pay on time, but it also means missed payments hurt your credit score more severely.
Perpay also tends to offer longer payment plans — up to twelve weeks — compared to some competitors that offer shorter windows of four to six weeks. However, Perpay's selection of partner retailers and available products is smaller than what some other services offer.
The choice between Perpay and alternatives depends on whether you want credit-building potential (which Perpay provides) or prefer a service that does not touch your credit report (which others do). Consider your own situation: if you are confident you can pay on time and want to build credit, Perpay may help. If you are unsure about your ability to pay, a service that does not report to credit bureaus might be safer.
What happens if you miss a payment
If you miss a payment, Perpay will attempt to withdraw the amount again on your next scheduled payment date. If that withdrawal also fails, the company will contact you by email, text, or phone to remind you of the missed payment and ask you to pay it.
Perpay charges a late fee for each missed payment, typically $10 to $35. The missed payment is reported to credit bureaus and appears on your credit report, lowering your score. If you continue to miss payments and your account falls far enough behind, Perpay may close your account and refer it to a third-party debt collector.
If you know you will miss a payment, contact Perpay as soon as possible to discuss options. Some companies offer payment deferrals or plan modifications, though Perpay's policies on this vary. It is better to reach out proactively than to let payments pile up.
Frequently Asked Questions
Does Perpay do a hard credit check?
No. Perpay performs a soft credit inquiry when you sign up, which does not lower your credit score. A soft pull lets Perpay review your credit history without the impact of a hard inquiry. However, once your account is open, Perpay reports your payment activity to credit bureaus, so missed payments will show up on your credit report.
Can I cancel a Perpay purchase after I've made it?
Cancellation policies depend on the retailer and the item purchased. Some retailers allow returns within a standard window, and if you return an item, you should contact Perpay to discuss how remaining payments will be handled. Perpay's terms vary, so check with the company directly about your specific purchase.
What if I can't afford a payment?
Contact Perpay before the payment is due. The company may offer options like deferring a payment or adjusting your plan, though this is not may provide. Ignoring the payment will result in late fees and credit damage, so reaching out early is important.
Does Perpay work internationally?
Perpay is currently available only in the United States. You need a U.S. bank account and a valid Social Security number to open an account. The service does not work for purchases outside the U.S. or for international users.
How long does a Perpay purchase stay on my credit report?
Paid-in-full accounts typically stay on your credit report for about seven years after the account closes. Missed payments or accounts sent to collections also remain on your report for seven years from the date of the first missed payment.