Your boyfriend, your dad, and your sister all want one of Everlane’s famous $100 cashmere sweaters for Christmas. Sure, that’s a great price for high-grade cashmere. But getting one for everyone on your list gets expensive.
Rather than burning a hole in your pocket, Everlane is giving customers access to an interest-free loan through a service called AfterPay. You pay a quarter of your bill up front, then pay the rest in four installments over six weeks. If you miss a payment, you have to pay a flat fee of $8. If you fail to pay off your loan by the due date, you will be subject to arbitration and you waive your right to bring a class action, and a lot of other scary things described in all caps in AfterPay’s small print. (In fairness, arbitration clauses and other such provisions are common in the broader credit industry, too.)
Everlane is pitching AfterPay as a helpful–perhaps even altrustic–service, since it charges no interest. “Holiday shopping can take a toll on the budget,” reads the copy in a recent Everlane email. “So we’re offering you an easier way to pay.”
Sure, it’s a better deal than using a service like Affirm, which charges 20% interest, and is popular with luxury fashion retailers like Birdies, TheRealReal, and Tradesy. And it’s about on par with Quadpay, which charges no interest to spread payments out across four weeks, and is used by brands like Koio, Senreve, Greats, and Ugg.
But Everlane is now part of a broader trend of fashion labels encouraging consumers to spend more money than they can comfortably afford right now. Our only word of advice: Be sure to pay back your bill before it’s due; otherwise, you could be dragged into arbitration in Delaware, where you may end up drowning in legal fees. Alternatively, here’s an idea: Maybe just spend a little less?
An Everlane spokesperson declined to comment.