Everything You Need to Know About Sezzle & Its Security Measures

If you’ve ever shopped online and wished you could spread out the cost, you’ve probably come across Sezzle. Sezzle is a payment platform that allows customers to buy first, then divide their purchases into multiple interest-free installments. If you’re wondering how Sezzle works and what protections are in place, this guide breaks it down, explains how the system functions, what its security measures look like, and what to consider before using it

What is Sezzle?

At its core, Sezzle is a “buy now, pay later” service that lets shoppers split a purchase into four payments instead of paying the full total cost upfront. Founded in 2016, Sezzle has quickly gained popularity in the United States and Canada, especially among consumers, retailers, investors alike, and younger shoppers who like flexible spending without traditional credit.

Most people first encounter Sezzle through the Sezzle app, which functions like a straightforward mobile shopping app. You choose it at checkout, make an initial payment, and the remaining amount is charged in set installments. For some purchases, shoppers can also use a virtual card for in-store or online payments, which works much like a digital wallet.

But convenience naturally raises another question: is Sezzle safe? Since it handles payments and personal data, security matters. Sezzle operates under strict payment card industry standards and uses encryption to protect user information, which is a major part of how Sezzle works behind the scenes. 

How does Sezzle work?

Sezzle works by allowing shoppers to split purchases into four interest-free installments over six weeks. When you choose Sezzle at checkout, either on a merchant’s website or via the Sezzle app, the platform pays the retailer upfront for your purchase. You then repay Sezzle in equal installments, with the first payment due at the time of purchase and the remaining amount charged automatically every two weeks.

This process is designed to be simple, transparent, and secure. Sezzle uses PCI Level 1 compliance and encryption to protect sensitive payment and personal data. For eligible purchases, shoppers can also use a Sezzle virtual card, which works like a digital wallet, allowing safe payments both online and in-store. For those who want even more flexibility, Sezzle offers options like Sezzle Up, which can help build your payment history while keeping your installments manageable. 

Sezzle’s flexibility allows consumers to manage larger purchases without incurring finance charges, while merchants benefit from reduced cart abandonment and increased sales.

Which problem does Sezzle solve and how?

One of the most significant obstacles for ecommerce retailers is the problem of cart abandonment. According to a report by Baymard Institute, the average cart abandonment rate is approximately 70%, meaning that seven out of ten shoppers who add items to their carts do not complete their purchases. One of the primary reasons for this high abandonment rate is the perceived unaffordability.

Many shoppers add items to their carts, only to abandon them at the last minute because they cannot afford to pay for the entire purchase upfront. This is especially true for millennials and Gen Z shoppers, who tend to prioritize convenience and flexibility in their shopping experience.

For a broader view on reducing cart abandonment beyond BNPL alone, this B2B ecommerce best practices guide, which covers checkout optimization, self-service, and smarter payment flows.

Sezzle’s platform addresses this problem by offering customers a way to split their purchases into four interest-free payments. Sezzle’s “buy now, pay later” solution allows customers to pay for their purchases over time, making it easier for them to manage their finances while also reducing cart abandonment rates.

Sezzle partners with retailers to integrate their platform into their checkout process, enabling customers to select Sezzle as a payment option during checkout. Once selected, Sezzle pays the retailer upfront for the purchase, and the customer repays Sezzle in four installments over six weeks.

Sezzle charges merchants a small fee for each transaction, which is typically around 6% of the total purchase price. However, the benefits for merchants are clear. Sezzle helps increase conversion rates, reduces cart abandonment, and attracts new customers who may not have been able to afford the purchase otherwise.

What impact has Sezzle made on ecommerce?

Sezzle’s “buy now, pay later” platform has had a significant impact on the ecommerce industry since its launch. The company has rapidly expanded its user base, as of Q3 2021, Sezzle reported 3.2 million active consumers, over 44,000 active merchants, and US$28.5 million in total income, reflecting strong year-over-year growth. 

In addition to its financial success, Sezzle has also made a positive impact on its users. 63% of BNPL users say cash-flow management is a key reason they use BNPL. This has been especially significant for young consumers, who are more likely to struggle with financial stability and budgeting.

What are the advantages of Sezzle?

Advantages for consumers

• Affordability: Sezzle allows shoppers to split their purchases into four interest-free payments, which makes it easier to manage larger purchases without straining their budget. Instead of paying the total cost upfront, users can make an initial payment and cover the remaining amount over six weeks, making online shopping more accessible.
• Flexibility: Customers can choose between weekly or bi-weekly installments, allowing payments to align with their pay cycle. This flexibility helps users budget effectively, avoid overdrafts, and maintain control over their finances while still being able to enjoy shopping.
• No credit checks: Unlike credit cards or traditional installment loans, Sezzle doesn’t require a hard credit check. This makes it an inclusive option for people with limited or poor credit history, enabling more users to access financial freedom and complete purchases without being penalized for their credit score.
• Convenience: The Sezzle app and Sezzle Virtual Card simplify the checkout process. Whether shopping online or in-store, users can complete transactions in minutes without entering card details for each purchase. This integration is similar to a digital wallet, offering a smooth, secure, and hassle-free experience.
• Risk-free experience: Sezzle doesn’t charge interest on the remaining amount or apply heavy penalties for missed payments. Accounts are paused until the installment can be made, preventing users from spiraling into debt. This approach reduces financial risk while still keeping purchases manageable.

Advantages for merchants:

• Increased sales: Offering Sezzle attracts customers who might otherwise abandon their carts because they can’t pay up front. This not only boosts immediate sales but also helps merchants reach a wider audience, including younger shoppers who prefer flexible payment options.
• Reduced cart abandonment: By providing interest-free installment options, Sezzle encourages shoppers to complete purchases rather than leaving items behind, addressing one of the biggest challenges in online shopping.
• Guaranteed payment: Merchants receive full payment upfront from Sezzle, regardless of whether the customer completes all four installments. This eliminates the risk of unpaid orders and ensures predictable cash flow.
• No fraud risk: Sezzle assumes all risks associated with fraud or non-payment, allowing merchants to offer flexible payment solutions without worrying about losses.
• Marketing support: Sezzle supports merchants with promotional campaigns, messaging, and resources to increase awareness and usage of service offerings, helping drive engagement and repeat sales.

Disadvantages of Sezzle

Disadvantages for consumers

• Late fees: While Sezzle is interest-free, missing an installment can trigger a service fee of around $10 per late payment. Repeated missed payments can also lead to account freezes or collections.
• Credit score risk: Although Sezzle does not report positive payments, serious defaults or sending accounts to collections can impact credit scores. Consumers should carefully monitor payments to avoid unintentional negative effects.
• Limited retailers: Not all online or physical stores accept Sezzle, which can restrict where users can apply the Sezzle virtual card or app for purchases.
• Payment schedule: The bi-weekly installment schedule may conflict with other bills or financial obligations, requiring careful planning to avoid missed payments and associated fees.

Disadvantages for merchants

• Transaction fees: Sezzle charges merchants around 6% per transaction. While this fee ensures guaranteed payment and risk-free service, it may impact profit margins on low-cost items or high-volume orders.
• Delayed revenue considerations: Although Sezzle pays upfront, merchants may face delayed reconciliation for reporting purposes, and integrating installment reporting into their financial system may require additional effort.

Should you use Sezzle?

If you’ve ever wished you could spread the cost of a purchase without worrying about high-interest credit cards, Sezzle might be the solution you’re looking for. Sezzle gives more financial flexibility while shopping online or in-store. With the Sezzle app or a Sezzle virtual card, you can complete purchases quickly, manage your installment schedule, and make larger purchases more manageable. Deciding whether to use Sezzle depends on your role as a consumer or merchant and your specific needs.

Here are some potential pros and cons of using Sezzle from both a merchant’s and consumer’s point of view:

1. Merchant’s perspective

Offering Sezzle as a payment option can attract customers who might otherwise abandon their carts, boosting sales and conversion rates. Merchants benefit from guaranteed payment upfront, reduced risk of fraud, and access to marketing support. Fees for Sezzle transactions exist but are often offset by increased revenue from new customers and higher average order values.

Pros:

• ‍Offering Sezzle as a payment option can attract more customers who may not have been able to afford the full purchase price upfront.‍
• ‍Sezzle assumes the risk of chargebacks, so the merchant doesn’t have to worry about losing revenue due to chargebacks.

Cons:

• Sezzle charges merchants a fee for each transaction, which can add up and eat into profit margins.
• ‍Sezzle pays the merchant in installments, which means that the merchant may not receive the full amount of revenue until all installments have been paid.

2. Consumer’s perspective

Sezzle can be a useful tool if you want to manage your purchases without paying the full amount up front. With its Pay-in-4 model, you can split a purchase into four interest-free payments, making larger purchases more accessible. The Sezzle app simplifies the process, and using a virtual card adds flexibility for both online and in-store shopping. However, it’s important to keep up with payments to avoid late fees or any negative impact on your credit.

Pros:

• Sezzle allows consumers to split the cost of a purchase into four interest-free payments, making the purchase more manageable for some consumers.
• ‍Sezzle does not require a credit check, which can be helpful for consumers who may not have a strong credit history.

Cons:

• Sezzle charges late fees if a consumer misses a payment, which can add up and make the purchase more expensive in the long run.
• ‍While Sezzle does not require a credit check, missing a payment or defaulting on one could potentially impact a consumer’s credit score.

Ultimately, whether or not to use Sezzle depends on the specific needs and circumstances of the merchant and consumer. It is important for both parties to carefully consider the potential benefits and drawbacks before making a decision.

Is Sezzle safe?

Sezzle operates as a Payment Card Industry (PCI) Level 1 compliant provider, the highest security standard in the payments industry. This means every transaction, whether on the website or mobile app, is encrypted to keep sensitive information secure.

To prevent unauthorized access, Sezzle requires verified account details, uses identity checks, and stores data in a protected environment. When shoppers use the Sezzle app or the Sezzle Virtual Card for online shopping, the platform shields card details so merchants don’t see or store them directly. This adds an extra layer of protection similar to a digital wallet like Apple Pay or Google Pay.

Key security measures include:

• PCI DSS level 1 certified: The highest standard for payment security, ensuring all card data is encrypted and stored safely.
• Fraud monitoring: Real-time tracking for unusual activity, like sudden location changes or suspicious spending, to prevent unauthorized transactions.
• Account protections: Users are encouraged to use strong passwords and keep PINs safe. Sezzle never asks for one-time codes or login details outside its app.
• Data safeguards: Sezzle uses firewalls, restricted access, and encrypted storage to protect sensitive information.

From a consumer protection standpoint, Sezzle also offers a Buyer Protection policy that can provide reimbursement for eligible purchases that are not received or are significantly different from what was described. Additionally, a Dispute Resolution process is in place to help consumers resolve any issues that arise with a purchase.

While no platform is completely risk-free, Sezzle’s industry-standard encryption, PCI compliance, and multi-layer security measures, combined with buyer protection, make it a safe and reliable choice for managing online purchases through its app, Sezzle Virtual Card, or digital wallet integration like Apple Pay or Google Pay.

Conclusion

In the end, Sezzle isn’t a magic money hack or a lurking security risk. It’s a tool, and like any tool, it works best when you understand exactly how it fits into your financial or business workflow. For consumers, that means treating Sezzle as a short-term budgeting aid, not an excuse to overspend, and aligning its pay-in-4 schedule with your actual cash flow so late fees and credit risks don’t sneak up on you. For merchants, it’s a strategic lever: you’re effectively trading a small slice of margin for higher conversion, larger carts, and access to younger, flexibility-driven shoppers, backed by Sezzle’s PCI Level 1 security and fraud protection. 

And if you’re evaluating flexible payment systems as part of a broader sales or ecommerce strategy, it’s worth noting that platforms like WizCommerce’s WizPay are expanding this same concept into a more unified, B2B-friendly environment, giving teams the ability to manage orders, payments, and buyer approvals in one secure workflow. 

Frequently asked questions

Where can I use Sezzle payments when shopping?

You can use Sezzle payments when shopping at thousands of partner stores online and in-store, either by selecting Sezzle at checkout or by creating and using a Sezzle virtual card through Apple Pay or Google Pay anywhere Visa is accepted, with some exclusions based on Sezzle’s policies.

What is Sezzle Anywhere, and how does it differ from regular Sezzle?

Sezzle Anywhere is Sezzle’s subscription-based version that lets you use a multi-use virtual card to pay in 4, almost anywhere Visa (via Apple Pay or Google Pay) is accepted, while regular Sezzle is the standard, free pay-in-4 option limited mainly to participating merchants; with Sezzle Anywhere, you also unlock extra perks like waived service fees, in-app deals, priority support, and potential cashback rewards. 

What are the risks of using Sezzle?

The primary risks of using Sezzle involve financial consequences if you miss a payment, as a late payment can result in a $10 late fee, and repeated missed payments can lead to your account being frozen, which prevents you from making further purchases and can eventually be sent to collections, negatively impacting your credit score, although Sezzle generally does not report positive payment history.

Does Sezzle charge a monthly fee?

Sezzle does not charge a monthly fee for its basic service; the company typically earns revenue through merchant fees paid by retailers and convenience fees or late fees charged to consumers only if they choose to reschedule a payment or miss a deadline.

Is it safe to give Sezzle my SSN?

It is generally considered safe to give Sezzle your SSN, or the last four digits of your SSN, as they use this information for identity verification and to perform a soft credit check to assess your eligibility for purchases; Sezzle uses industry-standard encryption to protect this sensitive data.

Can I pay monthly with Sezzle?

You generally cannot pay monthly with Sezzle, as their standard service structure is a Pay-in-4 model, which divides your purchase into four interest-free installments to be paid over six weeks, with the first payment due at checkout, although they do offer a paid upgrade called Sezzle Up, which may offer monthly payment options.

How to get approved for Sezzle?

To get approved for Sezzle, you typically need to be at least 18 years old, have a valid phone number and email address, possess a working payment method (debit card, credit card, or bank account), and undergo a soft credit check during the application process, which usually does not have stringent credit score requirements for initial approval.

Is Sezzle good for your credit?

Sezzle is not typically good for your credit because, under its standard service, it generally does not report positive on-time payments to credit bureaus, meaning it does not help to build your credit score, although it can negatively impact your score if your account is sent to collections due to non-payment.

What limit does Sezzle give you?

The limit Sezzle gives you is not fixed and varies by individual, as the approved amount is determined by a variety of factors, including your payment history, the store you are shopping at, and the results of their soft credit check, but initial limits are often relatively low and can increase over time with responsible usage.

How is Sezzle different from a credit card?

Sezzle is different from a credit card in that its basic Pay-in-4 structure is interest-free with a fixed, short repayment term of six weeks, whereas a credit card charges interest on revolving balances and offers much longer repayment periods; Sezzle is also generally easier to get approved for and does not report positive credit history, unlike most credit cards.