Friends, in today’s time, so many products of Buy Now Pay Later have come in the market that it has become difficult to tell which product is better for customers and which is not. Now due to this wave, Amazon also launched its Buy now Pay Later – Amazon Pay Later in India. Ever since Amazon Pay Later has come in India, since then there are many multiple reviews on it. But in this article, we will tell you in detail about Amazon Pay Later, what it is and how it works and whether you will get any benefit from it or not!
What is Amazon Pay Later?
Amazon Pay Later is a payment service provided by Amazon, through which you can buy any products on Amazon.in and pay later. Under Amazon Pay Later, a limit is provided to you for one month, using which you can buy any product on loan for one month. You can also convert Amazon Pay Later payment into EMIs, so that you can pay your payment in pieces.
See, now you must be aware that Amazon neither has any banking license nor Amazon is an NBFC (Non-Banking Financial Company). That’s why whenever Amazon comes out with any of its financial products, it takes it out by tie up with NBFC or any bank. Amazon launched Amazon Pay Later by tying up with IDFC Bank and Karur Vysya Bank and Capital Float, which is an NBFC.
Now basically its entire Front End is managed by Amazon and its Back End is used by all these three Financial Institutions together. Now how many EMIs you have to pay and how much interest you have to pay, all these are decided by IDFC bank and Capital Float. Along with this, the limit that is provided to you is also decided by both of them.
What Are The Eligibility Criteria To Avail Amazon Pay Later?
To activate Amazon Pay Later, you do not need any more documents. You need the following documents to avail Amazon Pay Later –
- A Valid Pan Card Number
- A Verified Mobile Number
- Bank Account
- Any one of these Valid Document for Address proof – Driving license, Voter ID card, Aadhaar Card, Utility Bills (not older than 60 days), Passport
- Your Age – 23 Years or Above
- CIBIL Score – 700 or Above
The most important thing to note in eligibility to activate Amazon Pay Later is that your CIBIL score should be 700 or above, otherwise you will not be able to take advantage of this service. For this only some of your basic information is needed which it fetches from your Amazon account. Setting up Amazon Pay Later is a One Time Process that you can do very easily. On Amazon, you cannot take advantage of Amazon Pay Later on two types of products – Jewelry Products and Amazon Gift Card.
Advantages And Disadvantages Of Amazon Pay Later:
Advantages
- The real advantage of Amazon Pay Later is the flexibility it offers. You can also make your full payment before your due date. In this you do not get to see any restriction. If you have a bill of Rs 10,000, then it is not necessary that you have to pay this bill at once, you can use it according to your convenience. In this, you do not have to take any extra charges.
- With the help of Amazon Pay Later, you can make payment of any product after one month without credit and debit card.
- In this, you can also make full payment of your product together or you can pay by converting that payment into EMIs.
- With this you can buy the product of your essential work even if you do not have enough money at that time.
Disadvantages
- Under Amazon Pay Later, you are not given any kind of cashback. Amazon keeps coming out with some offers from time to time to use this facility.
- Amazon Pay Later can be applied only by those who fulfill some of its Eligibility Criteria, such as – High CIBIL & Credit Score and clean payment history.
- In Amazon Pay Later, you get to see the maximum limit of Rs 60,000 only, which is very less as compared to the rest of the competitors.
- Amazon Pay Later can only be used for purchases on Amazon.in, which limits its usefulness for customers who want to make purchases on other e-commerce platforms or in physical stores.
What Major things should we keep in mind while using Amazon Pay Later?
Amazon Pay Later is a Pay Later service provided by Amazon, which is a Well Established E-Commerce Company. But in spite of this, as it happens in all Financial Services, before using them, we should know some important things about them. Which we will discuss now.
One of the main risks of Amazon Pay Later is that it can encourage customers to spend excessively and accumulate debt that they are not able to repay. This can cause financial stress and potentially hurt their credit score.
Customers should be aware of the interest rates and charges associated with using Amazon Pay Later, especially if they choose to pay for their purchases in monthly installments. If customers are not mindful of their repayment habits, they may end up paying more than they expect and incur unnecessary costs.
To mitigate these risks, customers should use Amazon Pay Later responsibly and ensure that they can clear the outstanding balance before using the service. They should also read the terms and conditions carefully and understand the interest rates and charges associated with the service. Lastly, customers should regularly monitor their credit score and take steps to improve it, if necessary.
Amazon Pay Later’s Maximum Limit:
In Amazon Pay Later, you are given a Maximum Limit of Rs 60000. More limit than this is not provided to you inside it. Now it is not even that you will get a limit of Rs 60000 in the starting itself, this limit is given to those people who keep shopping on Amazon from time to time and whose CIBIL score is quite good. But if you are not a regular customer of Amazon and your CIBIL score is good, then you will get to see the limit of Rs.5000 to 10000 or maximum you can see the limit of Rs.20000.
Whatever limit has been provided to you inside Amazon Pay Later in the starting, but as you keep using that limit, your limit increases. Amazon Pay Later has been made mainly for shopping on Amazon.
Amazon Pay Later Offers Two Types Of Payment Options:
Pay Later: This allows customers to purchase products on Amazon.in and pay for them at a later date. Customers can choose to pay the full amount or pay in monthly installments.
EMI (Equated Monthly Installment) Option: This allows customers to purchase products on Amazon.in and pay for them in equal monthly installments over a period of time.
Amazon Pay Later Fee And Charges:
Friends, now we will talk about Amazon Pay Later’s Fee And Charges, how much you have to spend to activate and run it smoothly –
Joining Fee And Annual Fee:
| Joining Fee | 0 Rs. |
| Annual Fee | 0 Rs. |
Late Payment Fees & Penalties:
You must know that in case of Buy Now Pay Later, if you have made your payment before Due Date, then in that case you will not be charged any interest or charges. In this, you are usually given 15 to 30 days time.
But if for some reason you are not able to make your payment on time, then obviously you will get EMI of it for 3 to 6 months, for which you will have to pay extra. Now in such a situation, if you get the EMI of your amount done for 3 to 12 months, then mostly Banks and NBFCs charge an interest rate of 1.5% to 2.5% and in some cases this interest rate goes up to 3% to 4% as well.
For example, in the case of credit cards, this interest rate ranges from 3% to 4%. But in Amazon Pay Later you get to see this interest rate very low. The charges for late payment of Amazon Pay Later are as follows –
| Monthly due amount (INR) | Late payment fee (INR) |
| <= Rs 200 | 0 |
| >200 <= Rs 1,000 | 125 |
| >1,000 but <=5,000 | 250 |
| >5,000 but <=20,000 | 425 |
| >Rs 20,000 | 600 |
These interest rates of Amazon are much lower than its competitors, whose interest rates you can also check on your end.
How To Close Amazon Pay Later Account?
To close your Amazon Pay Later account, you need to follow these steps:
- Log in to your Amazon.in account and go to the “Your Account” section.
- Under “Your Account,” select “Amazon Pay” and then click on “Amazon Pay Later.”
- On the Amazon Pay Later page, click on the “Close Pay Later Account” button.
- Follow the prompts to complete the closure process.
Once your Amazon Pay Later account is deleted, all the remaining balance in your account is returned to you. But if you have any bill or transaction pending and you want to close your Amazon Pay Later account, then in such a situation either Amazon will first deduct your money from your balance and then you will be given the remaining money or your account will not be closed. In this case, you may get an error of Payment Pending.
Conclusion
Friends, if you do not have any credit card, you can activate Amazon Pay Later. If you want to buy a product or service and you do not have full money for it yet and you are thinking that I will pay it after getting salary, then this is a good option for you. And credit cards also mainly have one of the biggest advantages that if you want to buy something and you do not have money, then you can use credit card and pay it on the due date of next month and there is no charge for this.
You get to see the same facility in Amazon Pay Later as well, but you can use this facility only on Amazon. Along with this, you also get to see Joining Fee and Annual Fee 0 Rupees. This option is best for you when you can pay for a product in a month.
But if you already have a credit card and you are thinking that this is a good thing, then it is not so at all because the benefits of credit cards are more than this. You get to see less charges in credit cards and you can use them offline or online anywhere. Therefore, people who are unable to get a credit card due to some reason can take advantage of Amazon Pay Later.