Fly Now, Pay Later Flights: Too Good to Be True?

Businesses are hearing Millennials loud and clear when they say that they do not want to use credit cards. The generation that is responsible for Uber, Airbnb, and countless other changes to the travel industry finally cracked seemingly the last holdout – the airlines. recently announced a Fly Now, Pay Later option that allows travelers to pay for a plane ticket in monthly installments, even after the flight is complete.

The Details

Cheap Air (Cheapair) - fly now, pay later

Studies have found that more than 60 percent of Millennials do not have a credit card. This puts big-ticket items like plane tickets out of reach, especially at the last minute.

Now, Millennials (or anyone else who does not have or does not want to use a credit card) have another option for booking air travel. Plans can be taken out for 3, 6, 9, or 12 months. They are handled through a third-party service that sets APR and other repayment terms.

“Credit card issuers, in many respects, have not kept up with the times and there are an increasing number of alternatives now available,” Jeff Klee, CEO of said in a statement. “We want to give everyone the freedom to travel, regardless of whether or not they choose to use credit cards.”

The CheapAir plan doesn’t come without a catch, though. Interest rates range from 10-30 percent, which can be higher than some credit cards. A new plan must be taken out for each flight purchased.

This financing option also locks travelers into booking from one company. This could spell trouble for Millennials who value crowdsourcing and consumer choice.

The Verdict on Fly Now, Pay Later Options?

The jury is still out on whether Travel Now, Pay Later will find success among Millennials. This is the group who has also said they are skeptical of banks and financial institutions in general.

CheapAir also states that opening a payment account will result in a soft credit inquiry. This means some Millennials with little or no credit history might not even qualify. And, there are no opportunities to rack up reward points that could be used in other areas.

The Fly Now, Pay Later plan is certainly getting a lot of buzz and may be a great option for the right traveler in the right circumstance, but credit cards should not be taken off of the table completely. They can help build a credit history that will be helpful later on when it comes time to purchase a home or a car.