Angela Millin, like many brides-to-be, quickly began planning her wedding after getting engaged in April 2021.
At the top of the to-do list was choosing a date and location, and setting a budget. Both her parents and her future in-laws had offered to help pay for the event, but once Ms. Millin and her fiance arranged for the wedding this December at the Perez Art Museum in Miami, they were shocked. for various expenses.
“All of the start-up costs are pretty staggering to look at,” said Ms. Millen, 32, a director of business development at a creative marketing agency. “Especially all at once.”
On the advice of their wedding planner, Annie Lee of Daughter of Design in Miami Beach, the couple decided to put their nuptials on layaway, so to speak, using the financial services platform. maroo. Introduced in July 2021, Maroo offers couples the option to pay for its provider network in facilities over a 12-month period, similar to how “buy now, pay later” programs offered by companies like Afterpay and Klarna allow couples to people pay incrementally for clothing and household items purchased online.
“Splitting cash flow,” Ms. Millen said, “means I’ve been able to feel more comfortable with such a large overhead.” For her wedding, the couple is using Maroo to pay for Ms. Lee, her planner, as well as her photographer, videographer, and hair and makeup artist.
The average cost of a wedding in 2021 was $28,000, according to a national survey of 15,000 couples conducted by wedding registry and planning website The Knot. The trade group The Wedding Report, in a separate study which surveyed 1,699 people, found that the average cost of a wedding last year was $27,000.
But when it comes to paying for an event, couples getting married have historically had little choice beyond covering the costs up front or with conventional loans or credit cards. “There has been no innovation,” said Anja Winikka, director of marketing for Maroo. “You have a lot of great planning tools, checklists, and photos to inspire you, but nothing for the painful process of paying for it.”
Personal finance writer Nicole Lapin, who holds an Accredited Investment Trustee certification from the Financial Industry Regulatory Authority, or Finra, advises couples to be wary of the lure of installment plans.
Their pay-later aspect can lead users to take on more expenses than they can afford, which is why Ms Lapin says such plans are best for financially stable people who can afford the full cost of a wedding up front, but they prefer to keep liquid cash to use or invest in other ways.
“A wedding is a special and momentous occasion, but at the end of the day, it’s a party,” said Lapin, who also hosts a financial advice podcast, “Money Rehab with Nicole Lapin.”
“I don’t like to go overboard financially for a party,” he added.
Maroo works like this: When a couple contracts with a provider in their network, that provider can submit an invoice through the platform. The couple then has the option of splitting the total cost of the bill over the course of three, six, or 12 months. Users can also opt for a more traditional plan and pay a 50 percent deposit up front, with the balance paid in a second lump sum just before the wedding date.
Before setting up any payment plan, Maroo runs a credit check called a “soft pull,” a less invasive check that doesn’t affect credit scores, to determine if users can pay a bill on time. If a couple fails the credit check, they have two options: renegotiate with a provider to lower the cost of a bill, or add contributors, such as family members, to the payment plan. (Credit checks are also performed on taxpayers).
Once a payment plan is approved, Maroo pays the vendor in full through an interest-free loan backed by Sivo, a lending platform. This loan is the one that couples are gradually repaying through facilities, which are interest-free. There is no additional interest if users default on payments, but outstanding bills can be sent to a debt collector, which can negatively affect credit ratings.
Aside from monthly payments, there are no fees to sign up or use Maroo. Providers in your network pay a fee of up to 10 percent of the total cost of a bill if included in a payment plan; the percentage charged depends on the duration of the plan. Payments made with Maroo are covered by a limited form of wedding insurancewith additional coverage available for additional charge.
Phillip Van Nostrand, a New York City photographer who uses Maroo, said the ability to offer customers the option to pay on the spot benefits his business because “talking about money” is often the most frustrating component when negotiate a contract. When customers have more payment options, you can reduce friction in the sales process. In that sense, “it’s a victory for all of us,” he said.
In January, wedding planner website Carats & Cake introduced its own installation plan program. Currently relegated to local payments, it offers users the option to split bills into four payments.
Instead of using loans from an outside lender, Carats & Cake, which has raised $29.9 million from investors to develop financial products, pays suppliers in full; Couples using their plans essentially pay for Carats & Cake. Jess Levin Conroy, CEO and founder of the website, says this approach allows for more control of the process.
A soft credit check is required to initiate a payment plan, and installments paid through the service are interest-free. If a couple misses a payment, they are subject to the penalties set forth in their contract with a venue. The company charges participating vendors a transaction fee, which averages 4.75 percent of the total cost of an invoice, Ms. Levin Conroy said.
Ellen Christie, director of sales for Pippin Hill Farm and Vineyard in North Garden, Virginia, signed the place up for the Carats & Cake service as a beta user in the summer of 2021. Since then, she said the program has been particularly effective in reducing costs. delays in receiving payments.
“Almost all of our deposits are paid early or on time now, which wasn’t always the case before,” said Ms. Christie. “It reduces the work of chasing people. That metric is important to us.”
Before their wedding last October in New York’s Hudson Valley, Rebecca Bell, 40, and Patrick Bell, 35, who live in Queens, signed up for Maroo when they realized most of their vendors wanted final payment one month before the event.
Although the couple had a budget from the start, Ms. Bell, director of photography, said it would have been “overwhelming” to pay for everything at once. She and Mr. Bell, who works at a social media company, wanted “breathing room” for any unexpected charges that might arise and decided to go on a payment plan.
With only two installations remaining, Mrs. Bell said: “We will have the wedding fully paid for, with no interest, before our first anniversary.”