PayPal has announced an addition to its services in the form of a credit system that takes on the credit card companies. There is a twist, however; there will be no interest to pay on online purchases over £150, as long as you pay off the balance in a four month period.
That means you can spread the cost of an expensive item online by paying in instalments, with no interest accrued.
It also applies each and every time you purchase a product online of that value or above.
Items under £150 or balances unpaid after the four month period are subject to the standard variable rate, which is currently 17.9 per cent interest per annum.
In addition, PayPal has partnered will a number of online stores to use PayPal Credit. They will offer incentives to pay for other items in instalments over even longer periods.
The online sites for Blacks, Chain Reaction Cycles, Dyson, Millets, Samsung, Simple Games and Ultimate Outdoors each offer different promotions for PayPal users approved to use the new credit system.
Samsung, for example, offers payment plans to PayPal credit customers who want to pay for an item over 6, 12, 18 and 24 months at a reduced interest rate of 14.9 per cent.
These offers can be chosen at checkout on each of the partnering retailers' online store pages.
PayPal Credit is available to all existing and new PayPal account holders. Customers need to apply online and, if successful, a credit limit will be added to their regular accounts.
"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."
You can find out more and apply for PayPal Credit on the dedicated website at PayPal.com.