Citizens Pay personal loan review: Available at select merchants

Pros

• Access to a revolving line of credit
• 3 to 36 months to repay purchases, depending on the retailer
• Ability to prequalify

Cons

• Only available through partner retailers
• Purchase minimums can vary
• Fees and interest may apply
• Could encourage overspending

What you need to know about Citizens Pay

Citizens Pay is a point-of-sale tool for retailers offers by Citizens, one of the oldest financial institutions in the U.S. When merchants sign up for the Citizens Pay service, their customers can opt to use it to finance purchases.

What is Citizens Pay?

Like other buy-now, pay-later apps, Citizens Pay lets you break up the cost of large purchases into smaller installment payments. But unlike some other BNPL apps, Citizens Pay gives people access to a revolving line of credit. And you can use Citizens Pay to make multiple purchases — within your credit limit — without having to submit another credit application or having to worry about juggling multiple loans.

How does Citizens Pay work?

Merchants enroll with Citizens Bank to offer Citizens Pay financing options. All lines of credit issued under Citizens Pay are financed through Citizens Bank, rather than the merchant itself.

When you’re shopping, you can use Citizens Pay when you shop through its partner retailers. If a merchant accepts Citizens Pay, you can opt to use it at the time of checkout. And depending on the merchant and the amount you finance, you can split your purchase amount into monthly payments and have up to 36 months to repay the line of credit.

Does Citizens Pay affect your credit?

Merchants that offer Citizens Pay offer prequalification tools. You can fill out the preapproval section and undergo a soft credit inquiry, which doesn’t affect your credit, to see if you qualify for Citizens Pay.

If you decide to proceed, Citizens will perform a hard credit check, which could impact your credit scores.

What kind of purchases can Citizens Pay be used for?

Initially, Citizens Pay was launched in partnership with Microsoft. Since its launch, it has expanded to include a variety of merchants. Citizens Pay can be used for the following types of items and services (note that this list could change, so you might want to double-check ahead of time if you’re planning on a specific purchase):

• Health and fitness — Citizens Pay can be used to pay for fitness equipment through retailers like Horizon Fitness.
• Home improvement contractors — In partnership with Arlington Financial, Citizens allows customers to finance home improvement projects with partner contractors.
• Education — Customers who want to enroll themselves or their children in exam preparation courses can use Citizens Pay to pay for educational products and services through Wiley Efficient Learning.
• Electronics — If you’re shopping for a new laptop, gaming system or other electronic device, you can use Citizens Pay at checkout with Microsoft. At Best Buy, Citizens Pay is required for purchasing Xbox All Access.
• Furniture — You can purchase sofas, bedroom sets and home office furniture with Citizens Pay at select retailers like Z Gallerie and Wayfair.
• Medical procedures — In partnership with PrimaHealth Credit, Citizens Pay can be used to pay for some medical procedures, such as dental treatments or braces as well as Lasik eye correction.

A closer look at Citizens Pay

If you’re considering using Citizens Pay to finance a purchase, here are some other things to know.

• Cart minimums — Each merchant sets their own purchase minimum for Citizens Pay. Depending on the merchant, the minimum can be as high as $900.
• Repayment terms — Available repayment options can vary by merchant and the total amount you finance. In general, terms range from three to 36 months.
• APR — While some merchants offer 0% APR, others may charge a variable APR.
• Late fees — If you miss a payment, you could face a hefty late fee. Some merchants charge fees as high as $38.

Who is Citizens Pay good for?

Using BNPL financing for retail purchases can make it easy to overspend and to pay more than you might realize in interest charges or fees. So it’s a good idea to only use Citizens Pay if you think the payments will comfortably fit within your budget. Not sure? Try using our budget calculator.

Citizens Pay may be best for those who have a major planned purchase coming up and want to spread the payments out in installments. Depending on the merchant, you may be eligible for 0% APR. So if you make your payments on time, you won’t have any added fees.

Citizens Pay can’t be used everywhere, so you may be better off shopping around for 0% interest credit cards or using another BNPL app that’s available with more retailers. You could also consider looking at personal loans.

How to apply with Citizens Pay

If you’re making a purchase through a merchant that offers Citizens Pay, the application process is simple.

• Find a partner merchant. With some BNPL apps, such as Affirm, you can use the service to finance purchases from any retailer. Citizens Pay works differently — it’s only available through select merchants. If Citizens Pay is available, it will show up in the merchant’s checkout section.
• Add items to cart. Add your desired purchases to the retailer’s cart. Depending on the merchant, there may be a purchase minimum you must meet to use Citizens Pay.  
• Check terms and fees. The annual percentage rate and fees can vary based on the merchant you choose. Depending on the retailer and your purchase amount, there may be a variable APR and potential late fees, so you’ll want to carefully review the terms and conditions.
• Consent to a credit check. To complete the transaction, Citizens will prompt you to consent to a credit check. It will perform a hard credit inquiry, which may affect your credit scores.

Not sure if Citizens Pay is right for you? Consider these alternatives.

• Klarna: With Klarna’s “Pay Later in 4” or “Pay in 30 days” options, there are no interest charges and no fees.
• Affirm: With Affirm, you can have your loan amount loaded onto a virtual Visa card that you can use at any retailer or merchant.

*Approval Odds are not a guarantee of approval. Credit Karma determines Approval Odds by comparing your credit profile to other Credit Karma members who were approved for the personal loan, or whether you meet certain criteria determined by the lender. Of course, there’s no such thing as a sure thing, but knowing your Approval Odds may help you narrow down your choices. For example, you may not be approved because you don’t meet the lender’s “ability to pay standard” after they verify your income and employment; or, you already have the maximum number of accounts with that specific lender.