NAB tackles BNPL with interest-free credit card
National Australia Bank has responded to the growing buy now, pay later market by launching a no interest credit card.
The Commonwealth Bank is the only other major bank to shift into BNPL through its tie-up with Klarna.
NAB said that unlike BNPL services, the StraightUp Card offers a continuing line of credit, is available to use anywhere Visa is accepted, has no late payment fees, and allows customers to repay balances over a longer period of time.
For a flat $20 monthly charge, customers can get access to credit of up to $3,000.
Customers don’t pay the monthly fee if the card is not used and there are no other fees or charges.
This means no interest, no annual fees, no late payment fees and no foreign currency fees.
NAB group executive, personal banking, Rachel Slade said the card had been developed through extensive customer research and an understanding the bank needed to innovate to keep pace with customer demands.
According to Slade, 85 per cent of credit card users, aged 18-34, think it’s important to feel in control of their credit card usage, with research showing young Australians are now a lot more conscious about their spending and savings behaviour.
“Credit cards have not really evolved in recent years. But our customers’ needs and expectations are changing and we want to change with them,” she said.
“In the NAB StraightUp Card, we’ve created something completely different to every other credit card available today, with a simpler approach that makes it easy for customers to take control of their finances.”
RFi Group’s latest research shows consistent growth in awareness of these services among Australian consumers.
According to RFi Group more than 2 in 5 Australians aged 18 to 34 indicating they have used at least one BNPL service, and across the market the data shows a steady increase in consumers who have used more than one service.
Key card features include:
No interest – always
No late payment fees
No use, no pay (monthly fee reversed when card isn’t used, and you have a $0 balance during the whole statement period)
No foreign currency fees
No annual fee
Can be used anywhere Visa is accepted, online or instore
Can be used with all contactless options, incl. Apple Pay, Google Pay, Samsung Pay and NAB Pay
No gambling or cash advances
New look card with improved accessibility features
Depending on a customer’s credit limit:
$1,000 credit limit: Pay $35 per month towards your balance ($10 monthly fee is included in your balance)
$2,000 credit limit: Pay $75 per month towards your balance ($15 monthly fee is included in your balance)
$3,000 credit limit: Pay $110 per month towards your balance ($20 monthly fee is included in your balance)
Slade said the bank would encourage customers to pay as much as they can each month.