Sezzle vs Perpay

BNPL That Report to Credit Bureaus

Both Sezzle and Perpay are one of the rare Buy Now Pay Later apps that actually reports to the three main credit bureaus (TransUnion, Experian and Equifax). They both offer 0% interest as well on their payment plans and do not perform any hard inquiries. However, they are also quite different and will appeal to different people.

In this comparison article, I will compare both Perpay and Sezzle and try to figure out which is better.

What is Sezzle

Sezzle is a rare Buy Now Pay Later app that reports your payment to the 3 major credit bureaus. Sezzle does not perform any hard inquiries and it is free to sign up. There are a few payment options available. You can opt to pay-in-4, pay-in-2 or pay in full. Pay-in-4 is a common payment scheme for most Buy Now Pay Later apps and this is how it works. You pay 25% of your purchase upon check out. And you pay 25% every 2 weeks until payment is finished. Under the pay-in-4 option, you will finish paying for a purchase in 6 week. There is also a monthly option where you can pay monthly and take anywhere from 3-48 months to pay off. This financing option is available for larger purchases and Sezzle works with lenders who will extend these loans to you. The interest rate will range from 0% to 34.99%. For this financing option, there will be a hard inquiry and you may get credit limits as high as $15,000.

If you want Sezzle to report to the three major credit bureaus, you have to enroll in Sezzle Up from your app. The only requirements are that you would have had to complete payment on your first purchase and link your bank account to Sezzle for payments.

Sezzle also has a Virtual Card called Sezzle Anywhere where you can use it literally anywhere (online or in-store) where Visa is accepted. There is a monthly subscription fee is varies with different customers.

What is Perpay?

Perpay is a Buy Now Pay Later marketplace that allows you to buy a wide range of product. Like Sezzle, they are one of the rare BNPL apps that reports to all three major credit bureaus. Perpay is unique in that they require you to pay for your purchase directly from your payroll. This requires what is called a "split direct deposit" from your payroll provider. If your payroll provider cannot accomplish this, then Perpay will do it for you. This method of directly paying Perpay from your payroll will appeal to some of you because it provides an ease of mind that you payment has been paid and you will never be late.

Perpay does not perform any hard inquiry when you apply though they do have a minimum monthly income requirement of $1,800. To get Perpay to report your payments to all three major credit bureaus, you have to enroll in Perpay+, which has a monthly fee of $3/month. Your payments will be reported once you have made 4 installment payments of at least $200 in total.

Perpay allows you to choose how long you want to stretch your payment. You can take up to 6 months to pay off your purchase. How often you pay will depend on your payroll cycle since payment is taken from your payroll. Like Sezzle, there is 0% in your purchases.

Perpay also has a Mastercard which can are eligible to get once you have enrolled in Perpay+. Unlike Sezzle, the Perpay Mastercard has a physical card and no annual fee (though it charges a one-time fee of $9).

Similarities

Both Sezzle and Perpay share the following similarities.

Both Sezzle and Perpay report to credit bureaus

Both Sezzle and Perpay report to the three major credit bureaus, TransUnion, Equifax and Experian. And both require you to enroll in separate programs. With Sezzle, you have to enroll in Sezzle Up to enable them to report to the credit bureaus. Sezzle Up is free though you do have to link and use your bank account to pay your installments to Sezzle. Sezzle will also start reporting after you complete payment on your first purchase.

Perpay requires you to enroll in Perpay+ to enable them to report to the three major credit bureaus. Unlike Sezzle Up, Perpay+ cost $3/month.

0% Interest

Both Sezzle and Perpay do not charge any interest for their payment plans. Actually to be precise, Sezzle does not charge any interest for their Pay-in-4 and Pay-in-2 payment plans. For the monthly plan (which can range from 3 to 48 months), the interest rate ranges from 0% to 34.99%.

Perpay's payment schedule matches you payroll since you will be paying Perpay directly from your payroll and you can take up to 6 months to pay off. Perpay does not charge any interest regardless of which payment plan you choose.

No hard inquiries

Both Sezzle and Perpay does not perform any hard inquiries when you sign up. However, with Sezzle, there will be a hard inquiry if you opt for monthly financing from their long term lenders.

Though Perpay does not perform any hard inquiries, you would need a minimum monthly income of $1,800 to be approved.

Differences

Sezzle and Perpay are different in the following ways.

Perpay charges for credit reporting

As mentioned earlier, you have to enroll in Perpay+ for tri-credit bureau reporting and it cost $3/month or $36 annually. In contrast, enrolling in Sezzle Up is free.

You have to pay Perpay from your payroll

Perpay is unique among all Buy Now Pay Later apps in that they require you to split your payroll direct deposit and pay your installments to them directly from your payroll. For some this is a hassle but for other, paying them directly helps them avoid late payments and getting into debt they cannot afford.

Different Payment Options

Sezzle offers 2 main payment options, the Pay-in-4 and Pay-in-2. For certain products with higher price points, Sezzle offers a monthly payment option ranging from 3-48 months with interest rate ranging from 0% to 34.99%.

Perpay requires you to pay your installment on your payroll date. You can choose how long you want to pay off your product and you can take up to 6 months to pay it off.

Perpays Mastercard is an actual physical card and not Sezzle's Virtual Card

Sezzle and Perpay are both Buy Now Pay Later apps and platform to purchase products on credit at 0% interest. But they also have "cards" that can be used anywhere. Perpay has a Mastercard that you can apply for if you enroll in Perpay+ for credit bureau reporting. It is an actual physical Mastercard which you can use anywhere Perpay is accepted. It has a one-time $9 fee and you may get a credit limit of up to $1,000. You will also earn rewards on Perpay purchases.

Sezzle has a virtual card called Sezzle Anywhere. You can use Sezzle anywhere Visa is accepted (whether online or in-store). Unlike Perpay Mastercard, Sezzle Anywhere has a monthly subscription where the fee varies with different customers. You would also have to get approval for each Sezzle's purchase on their virtual card.

Sezzle has higher potential credit limit

Perpay will start you off with a minimum of $500 in credit limit and could go as hgher as $1,000. With Sezzle, you may get a credit limit that is less than $500. But if you opt in for their monthly payment plan (which involves a hard inquiry), you can get up to $15,000 in credit lines.

Which is better? Sezzle or Perpay?

There are a couple of things that favor Sezzle over Perpay. Firstly, there is no cost to enroll in Sezzle Up (which enables credit bureau reporting) whereas Perpay requires you to pay a monthly fee of $3/month for Perpay+ for credit bureau reporting. Perpay also requires you to split your payroll direct deposit because they require you to pay your instalments directly from your payroll. While this may be easy to do, it is a hoop that some of you may not want to jump through. Perpay also requires a minimum monthly income of $1,800 whereas Sezzle has no such requirements. If you are fee sensitive and simply want to build or rebuild your credit with a Buy Now Pay Later app, then Sezzle edges Perpay.

However, one of the advantages of Perpay's requirement to pay them directly from your payroll is that it ensures that you will never fail on your payment. For those of you who have problems with late payments in the past, Perpay's method of payment will help you tremendously and is probably the better option for you.

If you are looking to get Sezzle or Perpay to get the Sezzle Virtual Card or Perpay Mastercard, then I would say Perpay would be the better option simply because I think the Perpay Mastercard is better than Sezzle's Virtual Card. Perpay Mastercard only has a one-time fee whereas Sezzle's Virtual Card has a monthly subsription fee.

To sum up, both Sezzle and Perpay are Buy Now Pay Later apps allow you to rebuild or build your credit score becuase they report to all three major credit bureaus. This is in contrast to most other BNPL apps which do not. Both also offer 0% interest and different payment options. But they are slightly different in big and small ways. For some of you, Sezzle would be the better option because there is no income requirement and the credit reporting service is free. For others, Perpays method of payment may be a better choice for you.