Zip (Quadpay) Canada Review 2024: Is It Worth it For Buy Now, Pay Later?
Zip Canada Review Rating: 3.9/5
You may have seen “buy now pay later” plans advertised when shopping online or in stores in Canada.
These financing options allow you to purchase items and pay for them at a later date, sometimes with interest.
As the demand for buy now pay later apps grows in Canada, the apps keep increasing in number. Zip Canada is one of the popular BNPL apps that’s unique in many ways.
This Zip Canada review covers everything you need to know about the app including its credit limit, fees and interest charges.
At the end of this article, you will be able to decide whether using Zip Canada is worth it or not.
What is Zip Canada?
Zip Co Limited operates in Canada under the brand name Zip Canada. This company offers the option to pay for purchases using a “Buy Now, Pay Later” (BNPL) plan.
Formerly known as Quadpay, Zip is a BNPL that allows consumers to make purchases online and pay for them in four (equal) interest-free installments.
Zip can be used for online and in-store shopping, allowing customers to make purchases and pay for them in installments.
If you are interested in using a BNPL service like Zip, keep reading to learn more about how it works and if it is right for you.
How Does Zip Work in Canada?
Zip Canada works in 3 steps as highlighted below:Â
- Shop online at your favourite stores
- Use Zip as checkout
- Split your payment over four equal installments
Zip Canada allows customers to make online purchases and pay for them in installments.
When you purchase with Zip, you will only need to pay a down payment of 25% of the total price.
The remaining 75% of the purchase will be divided into three installments due every two weeks, giving you six weeks to repay the loan.
Zip also allows you to pay off the loan before the six weeks without any penalty.
Zip Pay Stores in Canada
Zip partners with over 41,000 online stores. That’s, you can’t use Zip for in-store purchases.
Here are some of the stores that accept Zip as a payment method during checkout:
- Walmart
- Apple
- Target
- Best Buy
- Newegg
- Famous Footwear
- Bed Bath & Beyond
- Fashion Nova
- Gamestop
- Glamnetic
- Lashbox
- Bumpboxx
- Lids
- Fanatics
- Pokoloko
- Naturalizer
- Vitruvi
- Alternative Airlines
- Nourish
That being said, ZIP Canada stores fall under the following categories:
- Beauty
- Women’s Clothing
- Sports & Fitness
- Electronics & Gaming
- Footwear
Is Zip a Legitimate Company?
With over 11.4 million customers across 12 countries, Zip is one of the legitimate pay-after-delivery services out there.
Since its inception in 2013, Zip has been providing legitimate and secure digital payment solutions to its global customers.
The company uses advanced encryption and security systems to protect its customers’ online information against fraudsters.
What are Zip Fees in Canada?
Zip doesn’t charge fees on purchases in Canada. Also, the company doesn’t charge interest on purchases.
How does the company make money? By charging a $7 dishonoured payment fee due to insufficient funds in your account.
In addition, Zip makes money in Canada by charging its partner stores a merchant fee for using its service.
If you make a late payment, Zip may also charge you a fee. This is in addition to non-sufficient fund (NSF) charges you may incur on your credit card.
Bear in mind that some stores may charge you fees for using Zip at checkout.
How Can I Repay a Zip Loan in Canada?
By adding a debit or credit card to your Zip account, your loan repayments will be deducted automatically after every two weeks.
And with the option to repay your loan in full or in part before the due date, you can manage your payments according to your financial situation.
To help you avoid late payment penalties, Zip will send you regular email or text notifications about your due repayment.
That will ensure that you make available sufficient funds for pre-authorized deductions.
Can I Repay a Zip Loan Earlier or Later?
Absolutely! Depending on your situation, you can reverse or extend your Zip loan’s payment date.
With Zip, you can pay off your loan in installments by availing sufficient funds for automatic deduction every two weeks.
In addition, you can pay off the loan early at no extra cost. If you have trouble making a payment on the due date, you can also request to extend the payment period.
What if I Default on Repaying a Zip Loan?
Usually, Zip will send you an email or text notification about a due automated payment. If the automated payment fails, Zip will try to deduct the payment on the next business day.
If Zip fails to deduct the payment automatically, it will charge you a late payment fee and a dishonoured payment fee for the automated payment.
In addition, your credit card may charge you an NSF fee for the failed automated deduction.
And if you still refuse to repay the loan, Zip mag reports you to a collection agency, which could hurt your credit score.
Additionally, Zip categorically states that poor repayment history could prevent your future access to its services.
Pros and Cons of Zip Canada
The following are the key benefits and drawbacks of Zip in Canada.
Pros
- Partner Stores: Zip has multiple merchant stores in Canada that fall under different shopping categories. This makes it a one-stop-shop pay-after-delivery app.
- No interest & fee on purchases: Unlike other BNPL apps, Zip does charge interest and fees on purchases.
- Flexible Repayment: Besides the automated biweekly payment, Zip allows its users to make a single lump sum payment or larger installments before the due date.
Cons
- Not available for in-store purchases: At the moment, you can only use Zip Canada for online purchases.
- No mobile app: Zip is only available on a web portal at the moment. The lack of a mobile app could be a major drawback for shoppers looking for greater flexibility.
- Restricted information: Zip doesn’t specify the credit limit and late payment fees that apply to Canadians. This could mean that the company is hiding relevant information from potential users.
My Zip Canada Review Rating
I rate Zip Canada 3.9 out of 5 stars following a side-by-side comparison with other pay-after-delivery services and the overall rating of the following features.
Zip Canada Review Rating Methodology
Overall Rating
With 3.9 overall rating, potential users need to weigh the pros and cons of the Zip critically before signing up with it.
How to Open a Zip Account in Canada?
Opening a Zip account is a relatively easy process. All you need is to visit the sign-up page on the Zip website and click the “sign as a shopper button” provided you want to shop with Zip.
Upon clicking the button, you will be required to provide your phone number and receive a one-time code for verification.
After that, you will be required to log in to complete the registration by providing your personal details like your name, email date of birth, and address. You will also be required to link your credit or debit card to complete the registration.
After signing up, you can use Zip for online purchases. All you need is to search for your favourite stores through the Zip website.
Once you find the store, you can do your shopping within the website and select the “Pay with Zip” button at checkout.
Zipp will create a virtual card for you to pay for your purchase. You will then be given information about how much your payments will be and when they are due.
How Zip Compares in Canada
Zip is not the only BNPL company in Canada. Others include Afterpay, Klarna, Sezzle, PayBright, etc.
Here is a brief comparison of Zip Canada, AfterPay Canada, and Klarna Canada
| Feature | Zip | Klarna | Afterpay |
| Accessibility | Online | Online and in-store | Online and in-store |
| Number of global partner stores | 41,000+ | 500,000+ | 85,000+ |
| Number of global shoppers | 6.2 million | 150+ million | 19+ million |
| Number of countries covered | 12 countries | 45 countries | 8 countries |
| Installment payments method | 25% of the purchase cost is paid upfront with the remaining paid in installments | 25% of the purchase cost is paid upfront with the remaining paid in installments | 25% of the purchase cost is paid upfront with the remaining paid in installments |
| Loan Interest | None | None | None |
| Late payment fees | Applicable | N/A | Applicable |
| Supported repayment options | All debit and credit cards. Prepaid cards are not supported | All major credit and debit cards. Prepaid and AMEX cards are not supported | Mastercard, domestic VISA and AMEX card. International-issued cards and Interac e-Transfer are not supported |
| Mobile app | N/A | Available | Available |
From the above comparison, you can see that Klarna is ahead of Zip and Afterpay in terms of customer base, supported countries and stores.
In addition, Klarna doesn’t charge late payment fees. However, it reports late payments directly to a collection agency.
Unlike Zip, Klarna and Afterpay allow you to make both online and in-store purchases. The two pay-after-delivery services also have mobile apps accessible on Google Playstore and App Store.
Learn more about how Zip compares with Klarna and Afterpay in Canada under the following reviews:
Which Buy Now, Pay Later App to Choose?
Choosing a buy-now-pay-later app is not as easy as choosing a credit card.
From the above comparison, you can see how Zip compares with other BNPL apps out there. To make a cost-effective selection, you should consider the following factors:
- Credit limit: When selecting a BNPL service in Canada, it is important to consider the credit limit offered by each provider. Each BNPL service maximum credit limit that’s usually determined by the credit score of each user. So you should choose a provider that offers a credit limit suitable for your needs.
- Supported repayment methods: Different BNPL companies accept different credit and debit cards. You want to choose a company that supports your preferred payment method.
- Fees, interest rates, and fines: It is important to consider fees, interest rates, and late payment fees. Knowing the cost of using a BNPL app would help you save costs and avoid the attendant consequences of loan defaulting.
- Number of partners: The more partner stores a BNPL app supports, the greater flexibility you have when shopping through it.
- Accessibility: If you’re looking for greater flexibility, consider a BNPL service with a mobile app and access to online and in-store purchases.
Lessons From My Experience With Buy Now, Pay Later Apps
My experience with buy now, pay later apps like Zip was gained with mixed feelings.
While these apps can be handy especially when it comes to funding emergency bills, they can easily tie you into a debt trap.
I have realized that businesses partner with these apps mainly to keep consumers in their stores as much as they can.
So if you’re not financially disciplined, you may find difficulty getting out of the trap of buy now, pay later apps.
With these apps, it’s easier to spend more than your monthly budget as you can work at a store, shop and pay just 25% of purchases
This easy accessibility is the major drawback of buy now, pay later apps that’s currently tying many into a debt trap.
The fact that buy now, pay later apps don’t report to credit bureaus is something you should also be concerned about especially if you don’t have a credit card.
Having your on-time loan payments reported to credit bureaus will help build your credit score significantly.
As such, you don’t want to rely 100% on buy now pay later apps as your credit provider.
The Bottom Line on Zip Canada Review
BNPL apps like Zip could be a blessing or curse depending on how you use them.
If you’re not financially disciplined enough, you may incur debt that you can’t ever imagine through a BNPL app.
This is because BNPL apps are more easily accessible than credit cards as most of them charge no interest and fees on purchases.
If you submit yourself to this trick without control, the late payment fees and penalties could be worse than the purchase interest and late payment fees of the average credit card.
From the above review, you can see that Zip has some unique weaknesses that are worth thinking twice about.
To make an informed decision, I suggest you compare Zip versus the above alternatives and marrow your selection based on your needs.
The bottom line is that you should understand the terms and conditions of any buy now pay later plan before signing up with it.
FAQs on Zip Canada Review
Can I use Zip in Canada?
Absolutely. You can use Zip to shop online in Canadian stores. The drawback is that you can’t use Zip for in-store purchases in Canada, unlike Afterpay and Klarna.
Is Zip good for credit?
Zip is not good for building a credit score. This is because Zip doesn’t report your transactions to credit bureaus which is common among other buy now, pay later services in Canada.
Does Zip do a hard credit check?
No. Zip does a soft credit check when assessing your application. This will not hurt your credit score.
Does everyone get approved for Zip?
Zip doesn’t guarantee approval for all applicants. Approvals are based on the customer assessment guidelines and verification of Zip.
Why was I not approved for Zip?
You may not be approved to create a Zip account if you didn’t meet customer assessment guidelines or you fail to verify your identity.
Even if you managed to open a Zip account, there’s no guarantee that all your purchases with Zip will be approved.
A partner store with Zip can disapprove your purchase request based on various factors including your credit score.
Zip Canada Review
Summary
With 3.9 overall rating, potential users need to weigh the pros and cons of the Zip critically before signing up with it.
