As the holiday season approaches, many people face the challenge of managing their spending without accumulating high-interest debt. One effective strategy gaining popularity is the use of credit card installment plans, which function similarly to buy now, pay later (BNPL) services but with some key differences. According to a 2026 report from PYMNTS, the usage of these plans has increased by 13 percentage points year over year, outpacing BNPL services.
Credit card installment plans allow cardholders to split large purchases into fixed monthly payments, often with reduced or eliminated interest rates. For example, American Express's Plan It® offers no interest but charges a monthly fee of up to 1.33% of the purchase amount. Chase Pay Over Time and Citi® Flex Pay provide similar options, with fees varying based on creditworthiness and purchase amount. These plans are typically available for eligible purchases of at least $100 and can span repayment periods of three to 24 months.
Compared to standalone BNPL services like Klarna, credit card installment plans have advantages such as no separate application or credit check and the ability to earn credit card rewards. However, BNPL services may offer lower or no fees for timely payments. Additionally, 0% intro APR credit cards, like the Wells Fargo Reflect® Card, can be a better option for those needing extended repayment periods without additional fees.
Experts recommend using credit card installment plans for necessary expenses, such as unexpected car repairs or medical bills, rather than discretionary purchases. While these plans can help avoid high interest rates, they should be used sparingly to prevent accumulating unnecessary debt.