Revolut has become the latest firm to introduce a feature to allow customers to pay their credit cards in instalments.
The fintech group said it expected the move would “further increase competition and shake up the Irish lending market, whilst changing the way that Irish consumers utilise credit and manage their finances”.
The scheme offers structured repayment instalments at either three, six, nine, or 12 monthly intervals at an interest rate of 9.5 per cent. Sales of Revolut’s credit card card rose 87 per cent last year.
The company said the product would help customers “better manage their budget and spread the cost of large purchases, such as a holiday or a new smartphone, with structured repayments that help them to achieve their financial goals, while paying at their own pace”.
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Daragh Cassidy of consumer group bonkers.ie described the feature as “really handy” for a credit card, but pointed out it is “by no means unique to the Irish market”.
“KBC offered a feature like this before it exited the market and Bank of Ireland currently offers this feature on most of its credit cards too at a rate of just 6.9 per cent APR,” he said. “Though I wonder how many customers actually know about it and use it.
“What sets Revolut apart, as always, is how easy it makes using the feature. With Bank of Ireland you have to complete an online instalment plan request form or call the bank. Though you can also set up an instalment plan at the point of sale in certain retailers in some instances.
“But with Revolut it can all be done easily and seamlessly within the app at the touch of a few buttons.
“I would caution that while this could help consumers save money, which is obviously a good thing, it could also lead to frivolous spending if people don’t monitor carefully what they’re spending.
“If you have a credit card you should always try pay off your balance in full and on time each month to avoid paying interest. And this feature should only really be used for larger, important purchases.”
Rob Mooney, head of lending at Revolut in Ireland, said the move was about “simplifying credit card repayments in a way that many of the other Irish banks can’t”.
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