Lay Buy, what are your legal rights and what to watch out for

There is a new method of lay buy options available – now you can get your goods after you make your first payment.

When done right, buying something on lay-buy is a huge win for consumers. No credit checks are necessary because the shop gets to hold on to the goods until they are totally paid off.

Lay-buys are lovely – but only if done legally

There are still some companies – mostly smallish independent businesses who are still doing lay-bys in a very unfriendly way.

Lay-buy allows you to choose an item – a pair of shoes, for example – and pay them off every month,  with no interest added.

Lay buys are governed by the Consumer Protection Act (CPA)

But, we often see that stores have their own terms and conditions and these don’t agree with the Consumer Protection Act.

The biggest terms and condition is that there is no option for a refund – if you decide after paying for 2 months that you don’t want the item and you want your money back, the store owner might tell you to choose something else in-store instead.

According to the CPA, you can cancel a lay-buy at any time, for no particular reason, and you must be refunded all payments you’ve made up to that point, minus 1% of the retail price as a cancellation penalty.

For example, if you purchased a suit and it cost R2 000, the lay-buy cancellation penalty should be only R20.

More importantly, the stores must refund you – they can’t issue a credit note instead, locking you into buying with them again.

Wendy Knowler, the famous consumer journalist, had a complaint about someone who paid R20 000 in lay buy on his furniture and when he went to collect his furniture, the company said there is no stock available and he must choose something else instead. When the customer said no, he’d rather have a refund, the company said their policy is no refunds or exchanges. Thankfully this client got in touch with Wendy because he got all his money back!

Companies can’t make up their own terms and conditions that are in conflict with the Consumer Protection Act.

When you buy something on lay-buy, always make sure  that you have a copy of anything you sign!

READ MORE: Everything you need to know about lay-buy


PayJustNow is a new offer in the market. It is a combination of lay buy and credit agreement where they dodge the credit agreement requirements initially, but if you default, you fall into a credit agreement.

Originally with lay buy, you only get your goods once all moneys have been paid which is normally 3-6 months later, but PayJustNow allows you to pay in three instalments with the difference being that you can take your goods after the first instalment. And if you pay everything on time there is no interest.

For example, if you want to buy a suit for R2 100, you only pay R700, and you can take the suit with you. The two months after that, you will only pay R700 per month and the suit will be yours.

PayJustNow has already signed with Cape Union Mart and Poetry.

A great benefit of PayJustNow is that they reward good behaviour!

First time buyers can lay-buy only 1 item.

When you prove yourself, you can start buying more and more goods.

I do like the PayJustNow option. The only problem is if you miss payments, then you are effectively into a credit agreement because you have already taken the goods.

On lay buy, if you decide after 2 months that you can’t pay anymore, you can ask for a refund and give them 1% and you have your money back

Another good thing is that they promote responsible purchases by having you make only 3 payments, and allowing you to take the goods after only one payment.

This is great, because they are rewarding their customers who pay on time every time.

In conclusion, lay buy is still a good option, where you can save interest and have no debt, but as with all things when you are handing over money – be careful and always get a copy of what you sign.

If you need to talk to a debt counsellor about anything, contact RD Debt Counselling. We are award-winning debt counsellors based in Benoni, Gauteng.

Wendy Knowler shares her top 6 tips for getting the most out of lay-bys here.