By Rorisang Modiba
- Mmathapelo Sithole, 48, an unemployed mother of four from Pretoria West, was approved for PayJustNow instantly despite having no job.
- Financial adviser Nyiko Mashaba says paying BNPL on time does not guarantee a better credit score, unlike what Sithole believes.
Mmathapelo Sithole had no job when she applied for PayJustNow. The app approved her instantly.
She used the buy now, pay later service to buy clothes for her son’s matric dance last year, after a friend introduced her to it. “It made me feel like a good mother again after a long time. I could finally buy things for my child that I couldn’t afford before,” she said.
PayJustNow lets shoppers split purchases into interest free instalments over several weeks or months. Sithole, from Pretoria West, now uses it to buy groceries, clothes and gifts. She has also joined a stokvel, something she says she could not afford before.
“I can budget and save without worrying,” she said. Her debit order comes off on the 25th of every month, but she can pay early if she has the money before then.
Sithole believes her payment record with PayJustNow has improved her credit score. But financial adviser Nyiko Mashaba said this is not guaranteed.
He said some BNPL providers only report missed payments to credit bureaus, while others report the full account. Two people using different services responsibly could end up with very different credit profiles.
Mashaba said a credit score depends on more than paying on time. Lenders also look at how much credit someone is using, how often they apply for new credit and their overall debt.
South Africa’s National Credit Act does not clearly cover BNPL services because they do not charge interest. The National Credit Regulator has taken limited action against BNPL providers so far.
Sithole said traditional banks would not help her while she was unemployed.
“The banks don’t help unemployed people. The minute you say you’re unemployed, the call centre agent says, ‘Bye,'” she said.
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Image source: Pexels
