Adopting Buy Now, Pay Later for Club Memberships

A guide for clubs considering Afterpay through Square

Overview

Clubs can offer Afterpay for memberships through Square. Members split their fee into 4 interest-free fortnightly payments. The club receives the full amount upfront.

How it works

When a member selects Afterpay at checkout:

1. The club receives the full amount (minus fees) within 1-2 business days
2. Afterpay pays the club directly — the member’s repayment schedule is between them and Afterpay
3. If a member defaults, the club is not affected — Afterpay absorbs the risk

What it costs

6% + $0.30 per transaction (excluding GST). No monthly fees, no signup costs, no lock-in.

For comparison, a $200 card payment costs the club $4.40 in processing (2.2%). Afterpay costs an extra $7.90 per $200 membership.

Worked example

The extra cost depends on how many members use it and how many are genuinely new sign-ups.

No new members — 10 existing members use Afterpay:

The club pays $79 more in fees for the same revenue.

10 existing members switch, plus 2 new members join:

Be realistic though. For a $200 club membership where members are already committed to the sport, Afterpay is unlikely to be the deciding factor the way it is for a retail impulse purchase. Most members are going to join either way.

Where Afterpay genuinely helps is timing — a member who can’t afford $200 upfront in January might delay until March. Afterpay removes that delay and gets the club paid sooner.

Break-even: 1 new $200 membership ($186.60 net) covers the extra fees from 23 existing members switching (23 x $7.90 = $181.70).

Transaction limits

• Minimum: $100 (Afterpay won’t appear below this amount)
• Maximum: $2,000 per transaction

How to enable it

1. Log into your Square Dashboard
2. Go to Settings > Payment Methods
3. Enable Afterpay

Afterpay will appear as a payment option at checkout automatically. Your Square account must be in an approved merchant category — contact Square support if the option doesn’t appear.

When the club gets paid

Full amount (minus fees) on the next business day. The club does not wait for the member to complete all four instalments.

Refunds

• Process through Square Dashboard as usual
• Afterpay adjusts the member’s remaining instalments automatically
• Processing fees are not refunded — a full refund of a $200 Afterpay membership costs the club $12.30 in non-recoverable fees
• Refunds must be issued within 120 days
• Refunds cannot be reversed

Suggested Policies

These can be adapted to suit your club’s circumstances.

1. Membership activation

Memberships paid via Afterpay are activated immediately upon checkout, regardless of the instalment schedule.

Rationale: The club has been paid in full. No reason to delay activation.

2. Refund and cancellation policy

Clubs may choose not to offer refunds at all. If refunds are offered, consider a policy like:

Membership cancellations are subject to a $[15-20] administration fee. Refund requests must be made within [30/60/90] days of purchase. Refunds will be processed via the original payment method.

Rationale: A flat fee applied equally to all payment methods offsets non-recoverable processing fees. Do not charge a higher fee for Afterpay refunds — this may breach Afterpay’s merchant terms.

3. Pro-rata refunds

Members who cancel mid-season may be eligible for a pro-rata refund of the unused portion, less the administration fee.

Rationale: Fair to members while still covering processing costs.

4. Afterpay availability

Afterpay is available for purchases of $100 or more. Purchases below $100 must be paid by card.

Rationale: This is an Afterpay platform requirement, but should be communicated to members.

5. No surcharging

The club does not apply additional fees for members choosing Afterpay.

Rationale: Afterpay’s merchant terms prohibit surcharging.

6. Member communication

The club will display that Afterpay is available at checkout and include a brief explanation in membership registration communications.

Rationale: A note like “Pay in 4 interest-free instalments with Afterpay” is sufficient.

Frequently Asked Questions

Q: Does the club need a separate Afterpay merchant account? No. Afterpay is built into Square. Enable it under Settings > Payment Methods.

Q: Are there monthly fees? No. You only pay the 6% + $0.30 per transaction.

Q: What if a member defaults on their Afterpay payments? The club is not affected. The club has already been paid in full. Defaults are between the member and Afterpay.

Q: What if we need to refund an Afterpay membership? Process through Square Dashboard as usual. The processing fee ($12.30 on $200) is not refunded to the club.

Q: Can we offer Afterpay for event entries? Entry Place doesn’t support this at this time. Contact us if you believe this is a need for your club.

Q: Is the 6% fee worth it? See the worked example above. If no new members join, 10 members using Afterpay costs an extra $79. Break-even is 1 new membership per 23 members who switch. The real benefit may be removing the barrier of a large upfront payment at the start of the season.

Q: Can we limit which memberships are eligible? Not directly — Afterpay appears for all transactions between $100 and $2,000. Memberships below $100 are excluded automatically.

Q: Can we negotiate a lower rate? The 6% + $0.30 rate is fixed for most merchants. Clubs processing over $250,000 annually may be eligible for custom pricing through Square’s sales team.

Q: What if we switch payment providers? Existing Afterpay transactions continue as normal. Future transactions depend on whether your new provider supports Afterpay.

Summary

For technical integration support, contact the Entry Place team.