READY TO BOOK THAT VACATION, BUT DON’T HAVE THE MONEY YET?

New kinds of installment plans are offering options to shoppers who may remember layaway as something their parents or grandparents used. Now, people can purchase that new outfit or book that dream vacation and make payments. However, some experts caution the new plans could also be encouraging customers to stretch for purchases they can’t really afford.

NEW YORK» New kinds of installment plans are offering options to shoppers who may remember layaway as something their parents or grandparents used.

The payment businesses, many of them startups, are working with companies such as Urban Outfitters or Expedia to give shoppers an alternative to traditional credit cards. While layaway plans were getting used again during the Great Recession, their popularity has faded as shoppers don’t want to wait for their purchases.

The payment firms say they appeal to younger shoppers. “For them, it’s more like a budgeting mechanism,” says Nick Molnar, cofounder and CEO of Afterpay. “It means it’s more manageable to them.”

Afterpay, which launched in the U.S. in May, hopes to replicate its adoption in Australia, where it says it processes more than 25 percent of all online fashion and beauty transactions. Another company, Affirm, claims 1.5 million active U.S. users. Even American Express is jumping into the game.

Shoppers who use the new payment options are likely to spend more compared to when they use traditional forms of payment, says Tyler Higgins of the consulting firm Aarete. The installment plans may also help stores prevent abandoned carts by offering other ways to pay. And many of the payment firms take on any fraud risk, says Forrester Research’s Brendan Miller.

But experts caution the new plans could also be encouraging customers to stretch for purchases they can’t really afford.

Many of the new plans are basically mini-loans shoppers can take out for specific purchases when checking out at stores and online sites that participate.

The payment firms are promoting themselves on the front pages of the retail and travel websites they’re working with, and people can decide when they’re ready to buy something if they want to try it out.

Retailers such as Casper, Wayfair, and Expedia work with Affirm. Afterpay works with names such as Urban Outfitters and the online site Revolve.

Meanwhile, a company named Uplift has teamed up with travel partners such as American Airlines Vacations and Southwest Vacations and with Universal Orlando resorts.

The new payment firms don’t do traditional credit checks but use several pieces of data. Both Uplift and Affirm asks for the last four digits of customers’ Social Security numbers.

Afterpay doesn’t ask for the social security number but looks at how long people have lived at their addresses and their buying histories. The “loans” are approved or rejected in seconds or minutes.

Fees vary. Affirm says for many fashion purchases and certain other types of items, shoppers pay no interest. For others, it could be up to 30 percent based on customers’ credit. Afterpay requires customers to pay every other week in four payments. Uplift sets interest based on how it judges a person’s credit worthiness. At Amex, customers pay a fixed monthly fee based on their credit card’s annual percentage rate, but no interest charge.