Afterpay introduces spending cap for Australian users

Afterpay customers received an email from the company announcing the change that will be brought in later this year.

Afterpay will soon allow users to set spending caps on their own account. Picture: NCA NewsWire / Andrew Henshaw

Afterpay users will soon be able to put a cap on their own spending as the Buy Now Pay Later service updates its platform.

Australian users were informed of the update to the Afterpay Terms of Service for Australia on Tuesday.

Afterpay will soon allow users to set spending caps on their own account. Picture NCA NewsWire / Gaye Gerard

“This feature is launching later in 2024,” the email stated.

“When it’s available it will allow you to set a cap on what you can spend with Afterpay with a few simple taps in the app.”

The platform will soon allow users to create a spendig cap that is independent from their Afterpay limit.

The update is meant to put the user “in control” by allowing them to change the amount at any time or turn it off completely.

Buy Now Pay Later users have an average debt of $867. Picture NewsWire / Emma Brasier.

When customers first sign up to the platform, they’re initially given a $600 borrowing limit, which can be increased overtime.

The update comes after the latest Finder research found 43 per cent of Australians have used BNPL to make a purchase in the past six months – with the average customer with debt carrying a balance of $867.

Meanwhile, 7 per cent of BNPL users have missed a personal loan repayment to cover what they bought, while 6 per cent have skipped a mortgage repayment, according to the data.