Digital bank Monzo has rolled out a fresh update for those using its Monzo Flex credit card. The Monzo Flex service lets customers break down the cost of their spending over time.
Shoppers can divide eligible purchases into three interest-free monthly instalments, or spread them across six or 12 months with interest applied. Initially, users had to settle the full amount when paying with their Monzo Flex credit card, before opting to spread the cost through their banking app afterwards.
The bank then enhanced this capability in September 2024, enabling customers to split payments directly when shopping online - and now, the digital lender has extended this functionality to in-store purchases as well.
Should you fail to make a Monzo Flex payment, you'll have a seven-day window to settle it via the app - beyond this point, it could affect your credit rating and you may be switched to an extended payment scheme with interest charges, reports the Mirror.
When Monzo Flex was initially expanded last year, general manager Kunal Malani said in a statement: "Our customers love using their Flex credit card with Apple Pay and we're thrilled to be the first bank to bring this feature to Apple Pay users in the UK.
"Now our customers are able to choose their monthly payments-right at checkout with Apple Pay when using their Monzo Flex credit card. This brings an even more convenient experience for our customers when shopping online."
The Financial Conduct Authority (FCA) has initiated a consultation on buy now, pay later products amid concerns that some customers are accruing unmanageable debt. Under proposed changes, providers of buy now, pay later services will be required to ensure customers can afford repayments and provide assistance if they encounter financial difficulties.
Should any issues arise, borrowers will have the right to lodge complaints with the Financial Ombudsman Service. These regulations are set to come into effect when the FCA assumes oversight of buy now, pay later services in July 2026.
Companies will then have a six-month window from the implementation date to apply for full authorisation. FCA research indicates that one in five UK adults, approximately 10.9 million people, used buy now, pay later services at least once in the year leading up to May 2024, an increase from 17% in 2022.
As of May 2024, 2% of UK adults, equating to 1.1 million people, had outstanding unregulated buy now, pay later debts of £500 or more, while 11% of UK adults, around 5.3 million people, had outstanding debts of £50 or more.