Zilch launches paid tiers, Pay Monthly and a payday advance

Zilch has begun rolling out two paid membership tiers, longer buy now, pay later instalments and a payday-linked cash advance, in what the company describes as its biggest product expansion to date. The changes affect UK customers of the shopping and credit app, which Zilch says is authorised by the Financial Conduct Authority (FCA) for consumer credit and payment services — a status this article has not independently verified against the live FCA Register. Zilch says the four products — Extra, Plus, Pay Monthly and Advance — will roll out progressively across its customer base over the coming months, rather than appearing for every user at once.

The expansion comes after the FCA began regulating third-party deferred payment credit, commonly called buy now, pay later (BNPL), on 15 July 2026. That regime brought covered third-party deferred payment credit agreements entered from that date under FCA oversight; agreements entered before 15 July 2026 remain exempt, and not every product marketed as BNPL falls within the new regime's scope. Zilch says Pay Monthly and Advance operate within its customers' existing regulated Zilch credit agreement, rather than under permissions created specifically for this launch — a claim this article has not independently checked against the live FCA Register.

For UK customers, the practical questions are what the new tiers cost, what the longer instalment terms and the advance actually charge once fees and required memberships are added together, and how far Zilch's "borrow against your pay" language matches what is actually happening to their money.

What Extra and Plus cost

Zilch's free Standard plan continues. Sitting above it, Extra costs £2.99 a month and Plus costs £4.99 a month, according to Zilch's pricing pages as at 4 October 2026.

Zilch advertises Plus rewards as "up to" 6% on Pay Now transactions and "up to" 1% on credit transactions, available when the customer enables the Zilch card in the app before checkout. Those are maximum rates, not guaranteed returns. Zilch's public material does not establish the typical reward a customer earns, the eligible-retailer mix, or the detailed offer terms. The company's launch announcement describes the same reward structure in terms of "debit" and "credit" use; this article uses the product pages' own terminology of Pay Now and credit transactions.

Advance is only available to customers on Extra or Plus — Standard members cannot use it. That makes the membership fee a precondition of borrowing, not an optional add-on, for anyone who wants access to Advance.

How Pay Monthly works

Pay Monthly lets eligible Zilch Classic and Zilch X customers spread a purchase over three, six or 12 months. Zilch advertises rates "from 14.9% representative APR, subject to status" — meaning not every customer will be offered that rate, and some may be offered a higher one or refused credit altogether.

Separately, Zilch's product page states monthly fees of 0% to 1.6% when the Zilch card is enabled in the app before checkout, rising to 1.8% when it is not enabled or when the customer uses Zilch Anywhere. Zilch says an equivalent fee is added to the total repayment and spread monthly. The published material does not show how a given purchase's fee is set within that 0%–1.6% range, or how each fee figure reconciles with the advertised 14.9% representative APR across the three available terms. The 14.9% figure is representative and subject to status; it is not necessarily the rate an individual applicant will receive.

For the three-month option, Zilch describes the repayment structure clearly: the purchase is repaid in four equal instalments, with the first taken at checkout and the remaining three spread over the following three months. Zilch's product page does not set out the equivalent instalment schedule for the six- and 12-month terms, so a customer weighing up a longer commitment cannot currently see the full repayment pattern from the public page alone. Separately, one Zilch page displays "From 14.99% APR Representative" in a heading, while giving 14.9% in its representative example and on other product pages — a minor but real inconsistency between pages that a prospective borrower should check against their own pre-contract credit information rather than assume is settled.

Zilch's public material reviewed for this article does not state whether, or how, missed or late Pay Monthly payments are reported to credit reference agencies. Spreading a purchase over 12 months means carrying that debt, and the obligation to repay it, for a full year regardless.

How Advance works, and what it really costs

Advance lets an eligible customer borrow between £25 and £100, capped at 20% of their income as verified through an Open Banking connection, up to seven days before their verified pay date. Zilch collects the advance and fee automatically on that pay date.

Zilch charges no interest on Advance but applies a flat £3 processing fee per drawdown — its pages use "processing fee" and "transfer fee" interchangeably for the same charge. On a £100 advance, that means repaying £103 on payday. On the £25 minimum, the £3 fee is 12% of the amount borrowed; on the £100 maximum, it is 3%. These are simple proportions of the sum borrowed, not an APR, and should not be read as one.

Because Advance requires a paid Extra or Plus membership, the real minimum cost of using it even once in a month is higher than £3 alone. Attributing a full month's membership fee to a single drawdown gives an illustrative cost of £5.99 on Extra (£2.99 membership plus £3 fee) or £7.99 on Plus (£4.99 membership plus £3 fee). A customer who takes Advance repeatedly across several months, or who also uses Plus for other benefits, would spread that membership cost differently, and Zilch's public material does not state whether, or how often, a customer can take successive advances.

Salary advance or regulated loan?

Zilch's marketing frames Advance as access to pay before it arrives. Its detailed product and help pages describe it differently: as borrowing under the customer's existing regulated Zilch credit agreement, with the £3 fee and repayment collected automatically on the verified pay date. Zilch Technology Limited states on its website that it is FCA-authorised for consumer credit under firm reference number 843421, and separately authorised for payment services under firm reference number 1033706 — figures that this article has not independently checked against the live FCA Register.

That structure differs from the employer salary advance schemes the FCA addressed in guidance first published on 30 July 2020 and last updated on 13 August 2026. The FCA describes those schemes as typically giving employees access to wages they have already accrued, arranged through an employer or a payroll intermediary, and says they usually fall outside credit regulation entirely. Zilch Advance is not that: Zilch describes it as a cash drawdown under the customer's existing regulated credit agreement, arranged directly with Zilch rather than through an employer. The precise protections that attach to that agreement — including whether Financial Ombudsman Service access applies to this specific transaction — depend on the agreement's terms, which this article has not reviewed.

The underlying financial risk the FCA has flagged for salary advance schemes generally is still relevant, even though the legal structure is different. The regulator has warned that this kind of borrowing against future pay can leave someone short at the next payday, and that repeat use can create dependency and recurring fees. Taking £100 out of a payday seven days early, and having £103 taken back automatically on the day itself, reduces the money available for that payday's bills by more than the amount borrowed.

Customer risks and protections

Several practical questions about Advance and Pay Monthly are not answered in Zilch's public material. It is not stated what happens if an automatic Advance collection fails because there is not enough money in the account on payday — including whether Zilch retries the collection, reports the missed payment to credit reference agencies, or offers financial-difficulty support at that point. It is also not stated whether a customer can take more than one Advance in a pay cycle, or in consecutive cycles, which matters directly for assessing repeat-use risk.

Zilch says the Open Banking connection verifies both income and the expected pay date, and its launch material describes this as "AI-enabled," but gives no technical detail about the decision process involved, so that description cannot be independently assessed. The precise Consumer Credit Act protections that apply to Pay Monthly and Advance transactions, including when section 75 protection might apply, depend on the customer's actual credit agreement, which has not been reviewed for this article.

Anyone considering either product should check the pre-contract credit information Zilch is required to provide before they borrow, rather than rely on marketing copy. They should treat "up to" reward figures as maximum rates rather than typical outcomes, and treat the "from 14.9%" representative APR as a starting advertised rate that is not guaranteed to every applicant.

Why the regulatory timing matters

The FCA's regulation of third-party deferred payment credit took effect on 15 July 2026, following legislation made by the Government on 14 July 2025, the FCA's final policy statement (PS26/1) published on 1 February 2026, and its press release on 11 February 2026. Firms offering covered deferred payment credit now need FCA authorisation for the relevant consumer credit activity, or temporary permission, and must meet requirements covering clear pre-contract information, proportionate affordability checks, support for customers in financial difficulty, and access to the Financial Ombudsman Service.

The FCA has reported that the UK deferred payment credit market grew from £0.06bn in 2017 to more than £13bn in 2024, and that 20% of UK consumers — 10.9 million adults — used it in the 12 months to May 2024, according to its 2024 Financial Lives Survey. Zilch separately cites its own survey of more than 10,000 UK adults, reporting that 45% wanted rewards or savings from credit products and 47% wanted credit products to help manage spending; the company has not published the methodology, fieldwork dates or exact questions behind those figures, so they should be read as Zilch's own reported findings rather than independently verified research.

What to watch next

The full repayment schedules and worked cost examples for six- and 12-month Pay Monthly borrowing were not provided in the public product material reviewed for this article, nor is the completion date for Zilch's progressive rollout across its customer base. Readers wanting the current terms, fees and pre-contract information for a specific product should check Zilch's own product pages and credit agreement directly, and can confirm a firm's FCA permissions on the FCA Register at fca.org.uk.