Calculate the true cost of Buy Now Pay Later schemes compared to paying upfront. See the interest and fees on Klarna, Clearpay and other BNPL services if you miss payments.
Buy Now Pay Later has exploded in popularity in the UK, with an estimated 17 million users. Providers include Klarna, Clearpay, Laybuy, Paidy, and buy now pay later options built into credit cards. Following FCA regulation taking effect in 2026, affordability checks are now mandatory and missed payments are reported to credit reference agencies.
| Provider | Product | Interest | Late Fee | Cap |
|---|---|---|---|---|
| Klarna | Pay in 3 | 0% | £5/missed | £24 |
| Klarna | Pay in 30 days | 0% | £5 | £24 |
| Clearpay | Pay in 4 | 0% | £6/missed | 25% of order or £36 |
| PayPal Pay in 3 | Pay in 3 | 0% | None | — |
| Laybuy | Pay weekly ×6 | 0% | £6 | £24 |
Short-term BNPL products like Pay in 3 and Pay in 30 days are free if you pay on time — no interest is charged. However, if you miss a payment, late fees apply — typically £5–£6 per missed payment. Longer-term BNPL products often carry interest rates of 18–39.9% APR, making them potentially expensive.
Missing a BNPL payment triggers late fees (typically £5–£6), a reminder notice, and if unpaid, referral to a debt collection agency. From 2026, BNPL providers regulated by the FCA must report missed payments to credit reference agencies, so your credit score will be affected.
From 2026, regulated BNPL agreements are reported to credit reference agencies including Experian, Equifax, and TransUnion. On-time payments may help build credit history. Missed payments and defaults will harm your score. Some providers conduct hard credit searches at application, which can temporarily affect your score.
Both offer 0% interest if paid on time. Klarna also offers Pay in 30 days and longer financing options. Clearpay's late fee is £6 (capped at 25% of order or £36). Klarna's late fee is £5 per missed instalment (capped at £24). Neither is inherently better — compare availability at your retailer and your ability to repay the instalments.
Yes. The FCA took over regulation of most BNPL products in 2026 following Consumer Credit Act reforms. Regulated providers must now conduct affordability checks, provide clear credit agreements, and report to credit reference agencies. This brings BNPL in line with other consumer credit products.