We’re approaching that magical time of year when it can feel like there’s pressure to spend more than you can afford — and devote the rest of the year to paying off the debt.
One of the best holiday spending strategies is a tool you likely already have access to, whether you know it or not: credit card installment plans. These are effectively a buy now, pay later, or BNPL, option for credit cards, helping you to duck the typical high interest rates.
According to a 2026 report from PYMNTS, credit card installment plan usage has seen a13-percentage-point increase year over year. That’s more than twice the rate of BNPL use.
Here’s what you need to know about credit card installment plans so you can better decide if they’re a good fit for your financial needs.
Credit card installment plans
What is a credit card installment plan?
You’re probably aware that maintaining a balance on a credit card is one of the worst financial decisions you can make. Credit cards typically come with high APRs; the average credit card interest rate currently sits above 21%. You’re lighting money on fire when you carry a balance from month to month.
A credit card installment plan is a tool that some issuers offer to temporarily reduce or eliminate your interest on a large purchase that you know you won’t be able to immediately pay off. For eligible purchases, you can typically opt into a fixed repayment period. During this time, you’ll be charged equal monthly installments, either at a favorable interest rate or with a flat monthly fee, until your purchase has been repaid.
To be clear, the charge will appear on your credit card and eat into your total available credit. But if you’re currently carrying a balance, it’ll be treated differently than your outstanding debt in that a special APR (or a recurring fee with no interest) will apply. The monthly installment will be added to your existing minimum monthly payment.
You typically won’t be penalized for paying off your purchase early, and there is typically no sort of application or credit check.
Credit cards that offer installment plans
Not all credit card issuers offer installment plans. Even among issuers that offer them, not all cards in each portfolio may be eligible for an installment plan.
Here are some common issuer-provided installment plans.
American Express Plan It®
American Express Plan It® is available for eligible purchases of at least $100. Amex waives all interest with this installment plan and instead charges a monthly fee as long as the plan is active. The specific plan terms you’re offered will depend on your unique credit profile, but expect to be charged up to 1.33% of each purchase — with durations between three and 24 months.
Consumer American Express credit cards and charge cards with the Pay Over Time feature are eligible for Plan It. That may include popular options like the American Express® Gold Card and Blue Cash Everyday® Card from American Express.
The American Express Gold Card is great for earning valuable Membership Rewards® points at restaurants worldwide and U.S. supermarkets. Membership Rewards® points transfer to many of the top airline and hotel loyalty programs, which makes this card one of the best options for earning travel rewards.
- You can earn $400+ in dining and rideshare credits every year (Enrollment required for select benefits mentioned)
- Exceptionally rewarding for eligible restaurant and U.S. supermarket purchases
- No foreign transaction fees
- Large annual fee
- Credits are more complicated, you earn them monthly or semi-annually
- Spending caps on the top bonus categories
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- You may be eligible for as high as 100,000 Membership Rewards® Points after you spend $8,000 in eligible purchases on your new Card in your first 6 months of Card Membership. Welcome offers vary and you may not be eligible for an offer. Apply to know if you’re approved and find out your exact welcome offer amount – all with no credit score impact. If you’re approved and choose to accept the Card, your score may be impacted.
- Earn 4X Membership Rewards® points per dollar spent on purchases at restaurants worldwide, on up to $50,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 4X Membership Rewards® points per dollar spent at US supermarkets, on up to $25,000 in purchases per calendar year, then 1X points for the rest of the year.
- Earn 5X Membership Rewards® points on prepaid hotel stays booked through AmexTravel.com or the Amex Travel App™.
- Earn 3X Membership Rewards® points on flights booked through AmexTravel.com, the Amex Travel App™, or purchased directly from airlines.
- Earn 2X Membership Rewards® points on prepaid car rentals booked through AmexTravel.com or the Amex Travel App™ and cruises booked and paid through AmexTravel.com.
- Earn 1X Membership Rewards® point per dollar spent on all other eligible purchases.
- Pay It® lets you tap in the American Express® App to quickly pay for small purchase amounts throughout the month and still earn rewards the way you usually do. Plan It® gives you the option to split up big purchases into equal monthly payments with a fixed fee. You’ll know upfront exactly how much you’ll pay.
- $120 Dining Credit: Earn up to a total of $10 in statement credits monthly when you pay with the Gold Card at Grubhub (including Seamless), Buffalo Wild Wings, Five Guys, The Cheesecake Factory, and Wonder. This can be an annual savings of up to $120. Enrollment required.
- $100 Resy Credit: Get up to $100 in statement credits each calendar year at over 10,000 qualifying U.S. Resy restaurants after you pay for eligible purchases with the American Express® Gold Card. That’s up to $50 in statement credits semi-annually. Enrollment required.
- $84 Dunkin’ Credit: Earn up to $7 in monthly statement credits after you pay with the American Express® Gold Card at U.S. Dunkin’ locations. Enrollment required.
- $120 Uber Cash on Gold: Enjoy up to $120 in Uber Cash annually with your Gold Card. Just add your Card to your Uber account and you’ll get $10 in Uber Cash each month to use on orders and rides in the U.S. when you select an Amex Card for your transaction.
- Enjoy complimentary Hertz Five Star® Status benefits like skipping the counter at select locations, adding an additional driver at no additional cost*, and vehicle upgrades**. Benefit enrollment and Hertz Gold+ registration are required. *Additional drivers must meet standard rental qualifications and must be a spouse or domestic partner to qualify as complimentary. Other additional drivers subject to fees. **Benefits are subject to availability and vary by location. Additional Hertz program Terms and Conditions including age restrictions apply.
- Book two nights or more with The Hotel Collection through AmexTravel.com or the Amex Travel App™ and receive a $100* credit towards eligible charges at over 1,400 upscale hotels worldwide. *Eligible charges vary by property.
- Book your travel through the Amex Travel App™ with added peace of mind – backed by American Express® service and support. Only for American Express® Card Members.
- Whenever you need us, we’re here. Our Member Services team will ensure you are taken care of. From lost Card replacement to statement questions, we are available to help 24/7.
- No Foreign Transaction Fees.
- Annual Fee is $325.
- Terms Apply.
- See Rates & Fees
Foreign transaction fee
Chase Pay Over Time
Chase Pay Over Time comes in two different forms, depending on how you use it:
- After you make a purchase: You’ll be charged a fixed monthly fee in lieu of interest. Just complete an eligible purchase of at least $100 and then opt into Chase Pay Over Time by clicking the transaction in your account activity.
- Before you make a purchase: If you’ve got a qualifying Chase credit card in your Amazon wallet, you can initiate Chase Pay Over Time at checkout when shopping with Amazon. Carts that amount to $50 or more qualify.
You’ll typically make equal monthly payments for between three and 24 months. The exact terms offered to you will depend on your creditworthiness and account history, as well as the purchase amount. The monthly fee may be up to 1.72% of the amount of each eligible transaction.
Pay Over Time is available for the vast majority of Chase credit cards, both personal and small business. Think popular credit cards such as the Chase Sapphire Preferred® Card (see rates and fees) and Ink Business Unlimited® Credit Card (see rates and fees).
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections, flexible rewards and more.
- You can transfer rewards to all of Chase’s travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- Annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn 75,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, 3x on vacation homes at top brands, 3x on gas & EV charging, 3x on top streaming services and online groceries (excluding Walmart, Target, and wholesale clubs), 2x on all other travel purchases, 1x on all other purchases.
- Earn up to $100 in statement credits each account anniversary year for hotel stays through Chase TravelSM.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Coverage, Emergency Evacuation and Transportation, and more.
- Get a year of complimentary Apple TV when activated by December 31, 2026 – a value of $180.
- Complimentary DashPass membership, a $120 value for 12 months. Enjoy $0 delivery fees and reduced service fees on eligible DoorDash orders, plus exclusive Chase savings on grocery, everyday essentials, and more. Activate by 12/31/29.
- Receive one statement credit of up to $120 every four years as reimbursement for the application fee charged to your card for a Global Entry, TSA Precheck® or NEXUS application.
- Transfer points to leading airline and hotel loyalty programs.
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
Citi® Flex Pay
You’ll find Citi® Flex Pay on eligible Citi credit cards, such as the Citi Double Cash® Card and the Costco Anywhere Visa® Card by Citi. You usually won’t pay interest, but you’ll be charged a fee of up to 1.72% of the purchase amount.
Citi Flex Pay is only for eligible purchases of at least $75.
What makes the Citi Double Cash® Card special is that it sits near the top of its class in several categories. It is an excellent option if you want flat-rate rewards, a balance transfer intro-APR or no annual fee.
- Balance transfers get a long intro APR
- Generous flat-rate cash-back rewards structure
- Earns transferable rewards
- No annual fee
- It has a foreign transaction fee
- Intro APR only applies to balance transfer
- Points transfer ratios are reduced compared to premium cards
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® Points, which can be redeemed for $200 cash back.
- Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases. To earn cash back, pay at least the minimum due on time. Plus, earn 5% total cash back on hotel, car rentals and attractions booked with Citi Travel.
- Balance Transfer Only Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 18.49% – 28.74%, based on your creditworthiness.
- Balance Transfers do not earn cash back. Intro APR does not apply to purchases.
- If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
- There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. After that, your fee will be 5% of each transfer (minimum $5).
Balance transfer fee
There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. A balance transfer fee of 5% of each transfer ($5 minimum) applies if completed after 4 months of account opening.
Foreign transaction fee
How do card installment plans compare with other options?
Credit cards with payment plans work similarly to standalone BNPL services. Each has its own pros and cons. For example:
- Credit card installment plans don’t require a separate application and credit check. You’re simply using your existing credit line for a short-term plan.
- Unlike credit card installment plans, services like Klarna don’t charge interest or fees for select BNPL services, as long as you pay on time. It can be the cheaper option.
- Credit card installment plans tend to offer a longer repayment term than BNPL plans. As an example, Klarna offers “Pay in 4,” giving you six weeks to pay your balance. If you go longer than that, you may pay interest.
- You’ll still earn credit card rewards for your purchase when you use a credit card installment plan. You typically won’t earn anything with a BNPL service.
Klarna
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Interest rates
-
Credit limit
No predefined spending limit
-
Loan terms
-
Fees
-
Available merchants
Accepted at more than 450,000 merchants, including Amazon, Walmart and Target.
Also, if you know you won’t be able to repay a purchase for several months, a 0% intro APR credit card could be a better option than either of these. Some cards, like the Wells Fargo Reflect® Card, offer up to 21 months of no interest on purchases (17.74%, 24.24%, or 28.49% variable APR afterward). That means every dime you pay toward your balance will go toward the principal.
The Wells Fargo Reflect® Card is one of the absolute best cards you can apply for if you want to save on interest and pay down debit quickly thanks to its extra generous intro-APR offer on purchases and qualifying balance transfers.
- Incredible intro-APR for purchases and qualifying balance transfers
- No annual fee
- Cell phone insurance: up to $600 of cell phone protection against damage or theft. Subject to a $25 deductible
- No rewards
- No welcome bonus
- High balance transfer fee
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Apply Now to take advantage of this offer and learn more about product features, terms and conditions.
- 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers. 17.74%, 24.24%, or 28.49% variable APR thereafter; balance transfers made within 120 days qualify for the intro rate, BT fee of 5%, min: $5.
- $0 annual fee.
- Up to $600 of cell phone protection against damage or theft. Subject to a $25 deductible.
- Through My Wells Fargo Deals, you can get access to personalized deals from a variety of merchants. It’s an easy way to earn cash back as an account credit when you shop, dine, or enjoy an experience simply by using an eligible Wells Fargo credit card.
Balance transfer fee
Foreign transaction fee
The downside is that you’ll have to open a new credit card, which will result in a hard credit inquiry—temporarily dropping your credit score. But with responsible use, your score should bounce back quickly.
Should you use a credit card installment plan?
A credit card installment plan is a good tool when you know you’ll have to float a balance for a few months. Ideally, that’s a very rare occurrence.
Installment plans, BNPL services, even credit cards in general can be dangerous to those who are prone to impulse spending, as it enables them to effortlessly go into debt. There are perfectly legitimate reasons to use a credit card installment plan, but discretionary purchases aren’t one of them.
Things like unexpected car repairs and emergency medical bills are a great use of a credit card installment plan, as it helps you to avoid eye-watering interest rates. But if you’re considering using it for a luxury vacation, a 96-inch TV or another non-urgent purchase, better to wait until you’ve saved the cash.
FAQs
Do credit card installment plans charge interest or fees?
Credit card installment plans generally waive interest and instead charge monthly fees. The exact amount you’ll pay depends on your creditworthiness and the size of your purchase.
Can you pay off a credit card installment plan early?
Yes, you can pay off a credit card installment plan early. There are typically no prepayment fees for doing so.
What happens if you miss a payment?
If you miss a payment, your plan will usually stay active — but the missed payment will be added to your next statement. If you don’t repay your installments within your term length, you’ll keep getting monthly plan charges until it’s repaid. Also note that if you fail to make your credit card’s minimum payment, you could get dinged with a late fee.
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For rates and fees of the American Express® Gold Card, click here.
For rates and fees of the Blue Cash Everyday® Card from American Express, click here.
Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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