FORT WAYNE, Ind. (WANE) – It’s holiday season, and many are turning to alternative buying options, rather than purchasing gifts in full.

Buy now pay later payment services allow customers to purchase and receive items immediately, but pay later by splitting up the cost into monthly installments. Many have compared the service to layaway; however, with layaway you make payments until it’s paid in full then receive your items.

Nathan Grant, Senior Finance Industry Analyst at MoneyTips, says there are two popular types of buy now pay later programs including standalone apps or programs, and credit cards offering their own buy now pay later options.

Grant says standalone apps like Affirm or Afterpay are typically used by pressing a button at checkout online and usually do not require any interest payments. The app will also allow you to have a virtual credit card through the app specifically that you can use as a tap-to-pay form of payment at a store. Credit card programs let you sign up to pay off larger purchases in monthly installments without interest. Grant says these forms of payments are growing in popularity.

“Similar to merchants offering more tap-to-pay, accepting mobile wallets, and smart devices at checkout, as they’re getting more and more popular these businesses want to provide more ways for customers to pay, so they’re ensuring that they’re not shopping elsewhere,” Grant said.

Grant also weighed out the pros and cons of using these kind of payments. On the upside, customers can break down a large purchase into smaller payments without interest. Customers can also avoid a credit check in most instances when enrolling.

The downside of using these kind of programs include possible late fees if you miss a payment, and potential “soft credit checks” which might limit eligibility for other things you’d want to purchase in the future due to the payments not showing up on your credit report.

Grant recommends if you’re using one of these payment options, to be sure that you’re reading the fine print.

“I know it’s tempting, especially buying online you see the button and you click it, but if you really want to know what you’re getting into, make sure you read,” Grant said.

Find more tips and information on buy now pay later programs at the MoneyTips website.