An instalment plan gives you a structured way to pay off what you owe in equal amounts, over a fixed period of time. This structure is common with buy now pay later (BNPL) services and is also offered on some credit cards as a way to help you plan for repayments.
Most credit card instalment plans also offer lower interest rates than the card's standard purchase rate, which means you could save on interest as well.
Credit card instalment plans usually need to be set up or requested through Internet banking or your credit card's mobile app. Once you've done that, you'll pay a fixed amount off the balance when a payment is due – instead of paying some or all of your balance at the end of a statement period.
Depending on the credit card, you could set up an instalment plan for your entire account balance, part of your balance or for specific purchases. For example, if you have a Westpac credit card, you could use the SmartPlan service to set up an instalment plan for either a large purchase (over $500) or for a portion of your outstanding purchase, cash advance or balance transfer balance that’s worth more than $200.
While some providers offer instalment plans for any credit card, others offer this type of repayment option for specific purchases at participating retailers. You can use this table to compare the types of instalment plans available through different credit card companies and cards.
| Credit card company | Eligible cards | Summary of instalment plan options |
|---|---|---|
| American Express | All American Express cards (except corporate, small business and charge cards, or existing Amex David Jones cards) | American Express Plan It:
|
| ANZ | Personal ANZ cards |
|
| Bankwest | All Bankwest credit cards |
|
| Bank of Melbourne | All personal Bank of Melbourne credit cards |
|
| Citi | All Citi credit cards (subject to offer and eligibility) |
|
| Coles | Any Coles credit card (subject to offer and eligibility) |
|
| CommBank | All Commonwealth Bank credit cards |
|
| David Jones (Not available for new applications) | David Jones American Express David Jones American Express Platinum |
|
| Latitude Financial Services | Gem Visa Go Mastercard |
|
| humm | humm90 Mastercard |
|
| St.George | All personal St.George credit cards | St.George Plan&Pay offers two interest instalment plans:
|
| Virgin Money | All Virgin Money credit cards |
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| Westpac | All Westpac credit cards |
|
To give you an idea of how credit card instalment plans work, let's say we have just used a credit card to pay for a $3,000 holiday package. We can’t afford to pay this off in one go, so we decided to set up an instalment plan to help budget for the repayments.
In this scenario, we're given three different instalment terms to choose from, each showing how much the fixed repayments will be worth:
In this case, all of the instalment options offer 0% interest on the debt as long as we meet the repayment terms. So, if we knew we could afford to put $250 per month towards this trip, we would choose that option.
As most credit card instalment plans can be cancelled early without extra fees, we would also have the option of paying it off sooner if we found we could afford it.
Keep these features in mind to decide if a credit card that offers instalment plans will work for you:
As well as instalment plans, you could choose to pay off your credit card debt using one of the following options:
Getting a credit card that offers instalment plans gives you another way to structure your repayments and manage your budget. Just remember to consider the requirements of the instalment plan carefully before you apply and weigh up other repayment options so that you can find one that suits your needs.
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