Is Freo Pay Safe? Where Can You Use It? (Detailed Review)

Is Freo Pay safe? How and where can I use Freo Pay? Well, this is a very crucial question that I’m going to cover in this article. If you wanna use Freo Pay, then you must know whether it is safe or not.

Because it is a credit lending platform that offers a credit limit for purchases. Although Freo Pay offers an instant credit of up to ₹10,000 only, still it comes under the list of best BNPL apps available in India.

So, without further delay, let’s jump into this article and learn everything about the Freo Pay BNPL app.

What is Freo Pay?

Before knowing whether Freo Pay is real or fake, let us first look into what is Freo Pay used for and how it works.

Basically, Freo Pay is a BNPL (Buy Now Pay Later) app like Simpl, PostPe, and LazyPay. A popular FinTech company, known as MWYN Tech Private Limited, owns and operates the Freo Pay mobile app.

Freo Pay offers an instant credit limit of up to ₹10,000 which you can use to make payments at stores. It doesn’t charge any joining or annual fees, even it offers interest-free credit for 30 days every month.

Whatever credit limit you spend this month, you will have to repay it within the 5th of the next month. For example, if you spend ₹5,000 credit in February then you’ll have to repay the bill within the 5th of March.

But in case, if you forget to pay the bill within the due date then you will have to pay late payment charges. Due to non-repayment, Freo Pay can also suspend your account.

Freo Pay does not provide the credit itself because it is not a bank or NBFC. It has partnered with two RBI-registered NBFCs (Lendbox and LiquiLoans) that lend the credit to the users.

Here’s the simplest overview of the Freo Pay mobile app.

Pros and Cons of Freo Pay

Is Freo Pay Safe?

Yes, Freo Pay is absolutely a safe and secure BNPL app. They keep your personal and financial information safe. Some people say that it is not approved by RBI, so it can be an unsecured app.

Listen, Freo Pay is not a bank or NBFC, it is a platform that offers credit through its lending partners. Therefore, it doesn’t require a license from RBI, but it has all the permissions that a BNPL app requires.

By the way, it’s credit lenders that give the credit to the users are RBI-registered NBFCs. Not only Freo Pay most BNPL apps like Simpl and LazyPay work in this way. They are not directly registered with RBI.

So you can rest assured that your transactions are done securely. Now you will not have to ask anyone this question, is Freo Pay safe?

What are the Interests and Charges of Freo Pay?

As you can see in this table, Freo Pay does not charge various types of fees. It only charges late payment fees and convenience fees. You don’t have to pay any interest and charges if you repay the bill within 30 days.

But if you forget to repay the amount within the 30 days of time period, then you’ll have to pay late payment charges. And, Freo Pay charges a high amount of late fees than other BNPL apps.

It charges a late fee of ₹30 + GST per day. Suppose, your outstanding amount is ₹3000 and you’re not repaying the amount for 30 days, then you’ll have to pay a late fee of ₹900 + 18% GST.

And, you will also have to pay convenience fees of 5% + GST during repayment. That means, if your outstanding amount is ₹3000, then you will have to pay a convenience fee of ₹150 + applicable GST.

By the way, Freo Pay charges convenience fees every time you repay the outstanding amount. No matter whether you are making timely repayments or late.

Where Can You Use Your Freo Pay Balance?

Like PostPe, Freo Pay does not come with a credit card that you can use to make online purchases. It provides a scan and pay option that you can use to make payments by scanning any merchant QR code.

It has a big advantage that you don’t need to bring your BNPL card everywhere. Just like you scan and pay through UPI, similarly you can pay at any store through your Freo Pay credit limit.

You can use your Freo Pay credit balance for food orders, pay on delivery, fuel purchases, grocery purchases, and more. And remember, you can only make QR payments through Freo Pay.

Bottom Line: Is Freo Pay Safe?

In summary, we have come to know that Freo Pay is a 100% safe BNPL app. Since it is not a bank or NBFC, it does not require a license from RBI but it has all the permissions that a BNPL app requires.

Its credit lenders (Lendbox and LiquiLoans) are RBI-licensed NBFCs, so you can rest assured that Freo Pay is a safe platform to borrow credit. In this article, I have talked about Freo Pay in detail.

Apart from this, here I have covered two important questions, is Freo Pay safe and where can I use it? So, now I think you have got to know everything about Freo Pay.

In the bottom line, I would like to share my views about Freo Pay. I found Freo Pay as normal like other BNPL apps, but one thing I didn’t like about it is that Freo Pay charges a high amount of late fees.

Well, you can now decide whether it is a better BNPL option for you.

Frequently Asked Questions

Q. Can I withdraw money from Freo Pay?

No, you cannot withdraw money from your Freo Pay wallet. You can use your Freo Pay credit balance to make payments at any store by scanning a merchant QR code.

Q. How much credit limit does Freo Pay offer?

Freo Pay offers a credit limit ranging from ₹500 to ₹10,000. Most interestingly, the credit limit gets approved within a few minutes if you are eligible for it.

Q. Is Freo Pay RBI approved?

Since Freo Pay is a FinTech app, not a bank or NBFC, it is not registered with RBI. Because it does not require a license from RBI, but its lending partners are registered with RBI.

Q. Does Freo Pay charge convenience fees?

Yes, it charges a convenience fee of up to 5% of the credit limit you use in a month (+ applicable GST). You need to pay this convenience fee every month during repayment of the bill.

Q. What will happen if I don’t pay my Freo Pay bill?

Late fees will be charged. Not only this, if you don’t repay the bill, Freo Pay can also send you a legal notice and associate with a collection agency to get you to repay the outstanding amount.