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DIsclaimer: I have never used SplitIt – and this is not a sponsored post, but I am just genuinely excited about the premise. I will update this post when I have spoken to some users of it.

I have been looking at purchasing a new mattress and whilst this is not the most exciting thing to talk about, whilst looking for it, I discovered SplitIt. For though of you who aren’t aware (as I wasn’t just a few hours ago), SplitIt is a new payment method which allows you to use your existing credit to pay for a larger item in installments. Instead of taking out new credit for an item (common with mattresses, sofas etc) you choose to pay with SplitIt and you can make monthly payments of a set amount, like a direct debit, but it goes on to your existing credit card. This means that you can split the payments but without taking new credit. It also means you can still get the rewards such as cashback or points on your credit card that you would otherwise miss out on. Unfortunately though, the retailers have to sign up with them in the first place, so it’s not widely used in the UK at this time (hence why I had not heard of it).

I genuinely wanted to pay for the mattress I wanted using SplitIt as I didn’t particularly want to pay for it up front, but unfortunately the mattress I decided upon (after much research, deliberating and general faffing) didn’t offer SplitIt as a payment option. They could only offer pay upfront, pay with PayPal or 0% interest with Klarna. I have also never used Klarna, and I don’t know if it is a different branch of Klarna that manages the interest free payments as opposed to their buy now pay later services, but everything that I have heard about them is not good. The problem with them is that they offer this buy now pay later system, so a customer can purchase a whole load of goods, and then return the ones they don’t want before they are even paying for them. Whilst that might sound good in principal, meaning that consumers aren’t waiting for returns to be credited to their account before spending more money, it is not encouraging good financial skills such as budgeting. It also promotes the idea that they can have anything they want right away, even if they can’t afford it. They are basically encouraging people to get into debt. As a money blogger, and someone who has struggled with debt in the past, I didn’t feel that I could in good conscience take out credit with them, especially as I can afford to pay for the mattress up front (it just would have been nice to spead the payments).

From what I’ve read online and from the people I’ve spoken to,another issue with Klarna is that it is super easy to get in to debt, to miss payments and for costs to spiral with late payment fees and interest. There isn’t just the monthly direct debit of your payment coming out your account – you are almost given too much freedom, but at a cost – financial and more. I just didn’t feel comfortable using their service, especially as I got into debt when I was in Klarna’s target age.

As I mentioned earlier, I was not offered SplitIt as a payment option with my new mattress, however if I had been, I definitely would have given it a try.

Pros and Cons of SplitIt

Pros

  • Ability to spread payments
  • Do not have to take out additional credit
  • Can still earn points or rewards offered by your credit card provider
  • Means you get the additional security of using a credit card for a purchase

Cons

  • Payments need to be added into your budget
  • Not used at many UK retailers at this time
  • Credit card still needs to be paid off in full every month to avoid incurring fees and interest

Conclusion

On paper, SplitIt sounds like a great option for spreading your payments, however it is not widely enough used in the UK as yet for me to be able to speak to enough users of the service to get their reviews. I hope that it turns out everything it promises to be – as I do believe this type of payment method should be offered more widely, but only time will tell if they live up to my expectations.

As I manage to track down more customers I will of course update this post.

What do you think of the idea of speading your payments over your credit card? Is it something that you think would be beneficial? Let me know in the comments below.

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