Not everybody can pay full price for gadgets worth thousands of dollars. Thankfully, these days online marketplaces like 11Street and Lazada come equipped installment plans. But how do they work? And will you be able to take advantage of them?
Let’s find out.
What You Need to Know Before Signing Up
Taking on any kind of installment plan is a medium-term commitment so I would recommend that you understand what you are getting into before you sign up for one. Let’s take a look at the basics:
- You will need to first have a credit card. If you don’t have a credit card, your options will be very limited. As I understand, no online marketplace currently offers installment plans without a credit card.
- The cost of the item will reduce your credit card’s available limit. Even though you will be on an installment plan where your obligation is to make monthly payments on the amount owed, your credit card will still authorize the charge as a full amount, thereby reducing your overall credit limit. For example: if your credit card limit is RM3,000 and you make a RM2,500 purchase on installment on January, your credit limit for that month will be reduced to RM500. As you make payments on the installment plan, your credit card limit will naturally increase over time.
- If you don’t manage to pay every month you will be charged interest. For most banks, if you don’t manage to make the monthly payments the charges will become part of your normal credit card charges and standard interest rates (18% p.a.) may apply.
Once you understand what you are getting into, let’s take a look at how you can use the installment plans:
How to Pay Using Installment Plans on 11Street
11Street is my preferred choice whenever I am thinking about opting for an installment plan. That’s because you get more payment options on 11Street than Lazada.
On Lazada, you get to choose between 6 and 12-month plans using only Maybank but on 11Street you get to choose between 6, 12, 24 and even 36-month plans using either Maybank (maximum 24months) or Public Bank.
That being said, let’s take a look at how you can get started.
Let’s say you want to buy this Huawei Mate 10 on 11Street:
Add to Cart, Checkout and you’ll end up on this page:
Click on the red ‘Order’ button and you’ll be directed to the info and payment page:
Select the ‘Easy Payment Plan(Interest-Free Installment) option. Next, choose the bank you want to use:
Finally, choose the tenure period you prefer:
After that, key in your credit card details and make payment.
Normally that is all you need to do. But as an extra step, I would always call the bank to make sure that the installment plan is in place. Some people have experienced some errors whereby the installment plan was not arranged automatically, so I’d recommend checking.
How to Pay Using Installment Plans on Lazada
Now let’s take a look at how you can use installment plans on Lazada. Let’s say you want to buy this Huawei P10 from Lazada:
Add to cart, check out and you’ll get to the payment page. On it, select the last option ‘Maybank Installments’ (yes, you can only use Maybank credit card for any installment plans on Lazada):
Next, choose your tenure period. You have the option of 6 and 12 months:
Next, key in your credit card details and then make payment. That’s it. Again, I’d err on the side of caution and call the bank just to make sure that the installment plan is in place, rather than assume that it will be.
Getting an Installment Plan from The Bank Yourself
Unfortunately, not everyone has a credit card from Maybank or Public Bank. That doesn’t mean you cannot make purchases using installment plans. It just means that you will have to do it manually.
All you have to do is make a call to your bank after you have made the purchase and ask for your purchase to be changed into a monthly payment plan. Most banks offer a 0% interest rate as well, but be sure to check on the minimum purchase price to qualify for installment plans. Different banks have different requirements:
Table from www.RinggitPlus.com
Make sure to check your bank’s requirements before making a purchase.
A Word of Warning: Low Monthly Payments Does Not Mean You Can Afford Everything
It can be tempting to keep buying things because the monthly fees are so low. This can be a trap. Putting things on installment can give you the illusion that you can afford things you really cannot.
I would only use this option if I don’t have enough money but urgently need to say get a laptop for school or work because my previous one broke. However, I would avoid getting installment plans just because I can and want to get the latest phone. This is a sure way to end up perpetually in debt.
Hai , nice post and really helpful. btw, i would like to ask how about we buy it using installment plan then after confirmed everything , the payment using the exact amount or monthly payment amount?
Hi Amyy, you’re welcome. You will first be charged the entire amount to your credit card. These will appear on your credit card as ‘Authorised charges’. However, they will only charge you the monthly payment every month.
For example, you want to buy something worth RM1,200. Your credit card limit is RM2,000. If you buy this item, RM1,200 will be charged to your card as ‘authorized charges’. This means your limit will be reduced to RM800.
BUT. You don’t need to pay the RM1,200 straightaway. Every month, RM120 will be charged to your card. So you need to pay this RM120 or else you will get charged interest. But the balance of RM1,100 is not charged directly to your card but remain as ‘authorized charges’. So every month RM120 will be charged to your credit card until you finish paying the entire amount.
This is different to charging to your card the entire RM1,200 one go. If you do that, you need to pay RM1,200 within the same month or else get charged interest. In the case of installment, you only need to pay the monthly payments.
Hope this clarifies!
Hi Admin,
I noticed recently 11 street no longer had the installment up to 36 months. Max now is 12 months. Could you clarify with that?
Hi Ks, yes I’ve noticed that as well! I think now maximum is 12 months
hai! do they charge any extra for applying installment plan ? i saw it from somewhere else that we have to pay extra rm79
It depends on your bank actually. Some banks charge a fee for handling and administrative costs. To be sure just contact your bank. Not all banks will charge. For my own public bank card it is RM50.
Hi Admin,
Honestly, this a great post to know about installment plans. By the way, i would like to ask is it possible for us to pay off the installment earlier?
Hi Wayne,
It is possible. You need to contact your bank to arrange. However, as I understand, normally there is another fee applied, making the overall price higher. May not be worth it if you took advantage of installment plan for 0% interest rate.
Hope this helps.
– Lu Wee
But not all citizens can able to apply any credit cards like other people have good income. This installment plan gives limitation already. Really hard to purchase whole amount of an items without installment. Really unsatisfied that I still can’t apply maybank credit card due to salary no over from 2k. Without monthly installment I can’t buy my laptop.
Hey Dan,
You can check out LaterPay, which lets you split your price over 4 payments, with each payment due every 2 weeks.
Hope this helps!
I am Shopee user. But not all citizens can able to apply any credit cards like other people have good income that’s unfair condition. This installment plan gives limitation already. Really hard to purchase whole amount of an items without installment. Really unsatisfied that I still can’t apply maybank credit card due to salary no over from 2k. Without monthly installment I can’t buy my laptop directly. No offend.
These are bank regulations, not Shopee’s.
hi admin can we actually pay using cash at 7eleven
For installment using Credit card as mentioned in this article, unfortunately not 🙁
I don’t have credit card which mean i am not able to mange to purchase through installment plan however i am foreign therefore I cannot get this credit card and i want buy something using installment any suggestions?
Yeah that’s right. Nothing you can do without a credit card.
Hi, i would like to ask something. When will i get my item if i use installment? Is it after my debt is over or few days after i place the order?
Hey Mincu,
If you use your credit card installment plan, you’ll be able to get your item as per usual after a few days. Just that you need to continue the payments after that. That will be between you and your credit card company. Hope this helps!
– Lu Wee
Can i ask one question? When will i get my item if i pay using installment? Is it after my debt is over or few days after i place order? I need answer ASAP pleaseee??
Hello there, I found this post very helpful; so thank you for that. I have asked others but could not get a clear explanation. I’m glad you made it easier to understand this way.
However, I was wondering if the above applies to Visa? I wanted to purchase something through installments on Shopee recently and was happy that they accept my Public Bank visa. But I am unsure how the credit limit part would apply to my Visa. I hope you can help me understand the concept better. Thanks in advance!
Hey there, yes. Same thing either Visa or Mastercard. Credit limit would be based on your credit card limit. You just need to make sure you have the amount you want to use inside, then it will be fine. Hope this answers your question! If not, do let me know!
Yes, thank you very much, that clears my confusion. So it means that as you mentioned above, for visa, even though I will be charged the total amount during check out, my bank will only deduct the agreed upon installment amount; as long as I have sufficient funds to be charged the total amount initially as well as credit limit.
Yes, thank you very much, that clears my confusion. So it means that as you mentioned above, for visa, even though I will be charged the total amount during check out, my bank will only deduct the agreed upon installment amount; as long as I have sufficient funds to be charged the total amount initially as well as credit limit.
Yes correct. That means e.g. your product price is RM2,400. The RM2,400 will be held in your card as an authorized charge, then every month you will get charged RM200. However, if say your credit card total limit is RM3,000, you won’t be able to make more than RM600 worth of other product purchase 🙂
Hi , i don’t have credit card only debit cards . Thats mean I have to call bank and ask them that I want to do installment plan from lazada?
If you don’t have credit card, you can’t pay with installment plans.