Splitit exists to help consumers use their favorite credit card to turn purchases into smaller, monthly payments using their existing credit card.
At the time of purchase, we charge the first instalment. However, at the same time we also authorise the whole outstanding amount in order to guarantee future instalment payments. Authorisations for the full outstanding amount are renewed every 21 days or so and reduce with each instalment payment made. The previous authorisation is automatically removed as soon as we receive the new one.
Since it’s your credit, there are no applications or credit checks that affect your credit score and make things complicated to slow you down at checkout. And you continue to earn your points and rewards.
The way Splitit works, a hold is put on all the funds required to pay for the order, but you are only billed an instalment once a month. So you only owe your credit card issuer the instalment at the end of the month, not the full amount. However, you are not able to spend the rest of the money owed on something else, as those funds are held to cover the rest of the instalments.
Using our example above of buying a computer for £1,200:
If you buy it on your credit card WITHOUT SPLITIT, at the end of the first month you would owe your credit card issuer £1,200, or you would have to incur interest if you don’t pay it off.
If you buy it WITH SPLITIT, you would not be able to spend the £1,200 on anything else, but at the end of the first month you would only owe your card issuer £200, or you would have to incur interest if you don’t pay it off.
In the example on this page, you would owe £200 per month for 6 months until the plan is paid off.
Then Splitit is not the best payment method for you, as it is really a way to use spare credit card limits to buy. You should explore a full finance option, with a credit agreement looking at your ability to meet the monthly payments (see the finance tab above).