PayPal Credit Takes On Card Companies With Zero Percent Interest

PayPal has armed itself for battle against the likes of Visa and MasterCard with the launch of a credit service offering zero percent interest.

The company has today launched its PayPal Credit service in the UK, offering customers a quicker way to pay at hundreds of thousands of online stores either as a one-off or as part of their existing digital wallet.

The service is open to existing and new PayPal account holders, who can apply via the company’s website or through selected retailers, with the service immediately available to successful applicants.

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Where PayPal Credit might have the edge over its competitors is in automatically offering zero percent interest for the first four months (excluding instalments) on all purchases over £150 made with the service. However any balance outside of this will be subject to the standard variable rate, which is currently 17.9 percent interest p.a.

Customers can also view their purchases and manage their account any time online, in the PayPal app or over the phone, and there’s even the flexibility to spread the cost with an offer, or even repay early with no additional charges.

PayPal says it has already signed up the likes of Samsung, Dyson and Millets to enable monthly payment instalments, with the service built into existing online check-out, allowing users to see upfront how much they will pay each month; complete the simple application form in minutes; and receive an instant decision at the point of purchase.

“Today’s announcement is another example of how PayPal is so much more than a button on a website. We are using technology to reimagine money. For consumers, it’s about giving them more choice and convenience when shopping online. For businesses, we are enabling them to grow and offer their customers greater payment flexibility,” said Cameron McLean, managing director of PayPal UK.

“It’s a sign of things to come. As a newly-independent company, we will continue to partner with retailers to find new, improved ways for people to pay.”

The launch is PayPal’s latest move into establishing itself as a central part of the end-to-end retail and payments process.

Earlier this year, it launched PayPal Commerce, which will allow businesses to show off their products in more places than ever before by letting them place ‘Buy’ buttons on social media, emails and online adverts.

Last year, the company confirmed that it was bringing its web-based One Touch for Web platform to the UK, allowing shoppers to pay for goods or services with just one tap or click – eliminating the need to enter in login information each time they reach a checkout.

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