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What is Humm, and can you trust it?

How the buy now pay later service works, and the risks to consumers when accessing this type of unregulated credit.

hand pointer clicking on humm logo
Last updated: 05 November 2021
Fact-checked

Fact-checked

Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Humm Group, previously Flexigroup, is an Australian fintech with a number of financial products, including the Humm and Bundll buy now, pay later (BNPL) platforms. Humm Group has around 2.7 million users in Australia, New Zealand and Ireland. 

Here at CHOICE we have ongoing concerns with BNPLs and their lack of regulation, which we believe pose a threat to financially vulnerable people. Marketed to young people as being a hip alternative to layby or a credit card, BNPLs skirt national safe lending laws and are actually a form of unregulated credit. 

In 2021 we gave the Humm BNPL service a Shonky Award for being the biggest lemon on the BNPL tree. 

In this article we cover the ins and outs of Humm, whether or not you should use it (spoiler alert – probably not), and why we think Humm deserved that lemon gong.

What is Humm?

Humm is a buy now, pay later service that you can use online or instore through their app. BNPLs are services that operate between retailers and customers. Retailers get their funds upfront from the service, and people receive their purchases straight away while paying off the purchase cost in instalments back to the BNPL. 

Buy now, pay later is often touted as an alternative to layby, but in reality it functions more like a credit card – albeit with fewer regulatory protections (more about that later!).

Humm is split into two products:

  • Little Things for purchases up to $2000
  • Big Things for purchases over $2000 and up to $30,000.

How much you're able to borrow depends on Humm's approval process, and you may not be able to borrow the maximum amount. 

How Humm works

You can use Humm by downloading their app and signing up. You'll then go through an approval process where you'll need to provide documents including ID, employment details and bank statements. For purchases over $15,000, Humm will also check your personal expenses. 

To be approved you need to be an Australian citizen or permanent resident between the ages of 18 and 89. For Big Things over $2000 you also need to be employed for more than 25 hours a week or be a veteran or aged pensioner. 

Once you've been approved you can then spend up to your limit instore and online with retailers who accept Humm. When shopping online you can select the Humm payment option at checkout for stores that offer the service. When shopping instore you use the Humm app to create a barcode, which is then scanned at the point of payment. 

Caution: You need to pay a deposit upfront when making a purchase. In Australia this amount varies by retailer so make sure you check in advance so you don't get a surprise debit. In New Zealand the deposit is 20%.

online shopping

You need to make a deposit up front when making a purchase and in Australia this amount varies by retailer.

Humm repayments

Humm repayments are spread out over 5 or 10 fortnightly repayments for Little Things, or up to 60 months for Big Things. When you apply, you nominate a payment method which can be a bank account, debit card or credit card. Once nominated, repayments are deducted automatically from the account when due. 

If you have multiple purchases, the repayments may not be due on the same day – it depends on when the purchase was made. The schedule of repayments appears in the Humm app. 

The monthly fee is due on the first business day of the month.  

There may also be extra fees and charges based on the payment method and the length of the payment plan selected – see Humm interest and fees section further on in this article.

Caution: Being able to nominate a credit card as a payment option opens you up to being slugged a double whammy of any applicable fees and interest on your credit card (including overdraw or dishonour fees if the payment bounces) in addition to what Humm may be charging. This can really add to the original purchase cost of the item. Think twice before adding this as a payment option to your BNPL account.

Good to know: If you need to defer a payment, you can move an individual upcoming payment through the Humm app. You can also make early repayments. But you can't make a one-off payment or change your payment amount.

If you can't make repayments

If you're in financial hardship and can't make repayments, contact Humm immediately. You can do this via phone on 1800 088 151 or through their web form. They have hardship options in the form for reducing your instalments if you're experiencing hardship because of health, employment, relationship, death or overcommitment. 

Caution: Humm does not specify what their hardship policy is or how they might actually help you.

How to cancel a Humm account

You can cancel your Humm account at any time. You need to give notice in writing (you can do this through the Humm portal). However, they'll only close your account once you've repaid your balance in full. They may also cancel your account if it's been inactive for 24 months or it's in default. 

Where you can use Humm

Humm is available in over 20,000 stores including Myer, Ikea, JB Hi-Fi, and Bing Lee. You can use it to buy regular goods, medical and dental services, vet care, and larger purchases such as solar panels. 

Can I pay bills using Humm BPay?

Yes. Humm has an option to pay your bills using BPay for values between $20 and $2000. Bills more than $80 can be spread over five months of fortnightly payments.

Caution: Be aware that Humm charges an $8 monthly fee when using it to pay bills greater than $80 with Bpay – this can add up. If, for example, you paid an $80 bill off over five months as permitted, you'd spend $40 in fees. That's an increase on your bill price of 50%. 

Good to know: If you're struggling to pay a utility bill, there are other options available. Utility providers are required by law to help, whether this is applying their hardship policies, changing your plan, or putting you onto a payment instalments – and this shouldn't cost you anything extra, either. Your first point of call should be your utilities provider – contact them as soon as you realise you'll have trouble paying a bill.

Can I buy a car with Humm?

No. You cannot buy a car using Humm.

Does Humm do credit checks?

No. Humm does not conduct a formal credit check using credit agencies like a bank would. 

We asked them four times, using online chat and queries to head office, what their policies were around background checking and got a different answer every time. 

They will check information such as your ID, bank statements, and expenses for higher loan amounts – but this is not a formal credit check.

Caution: Not doing a full credit check means that they do not fully assess someone's ability to afford the amount borrowed. This means that it falls back onto the individual applying to assess their own ability to pay, and this is problematic. There are no protections in place to prevent people from overextending financially or having accounts with multiple BNPLs.

Will Humm affect my credit rating?

Signing up for Humm won't affect your credit rating and it shouldn't show up on your credit record as an enquiry as they're not performing a formal credit check.

Caution: If you miss payments or default on your account, Humm can report you to a credit agency and can charge you a $30 collection fee in the process.

Humm may consider your account to be in default if your scheduled payment is more than two business days late – which is not very much time at all. It's important to stay on top of your payments to avoid late fees and potential debt collection action. 

So signing up to Humm won't affect your credit rating, but if your account goes to debt collection that certainly might – be mindful of that risk when you sign up. 

going through finances troubles

It's important to stay on top of payments to avoid late fees and potential debt collection.

Humm interest and fees

Does Humm charge interest? 

No. But although it doesn't charge interest for purchases, they do charge fees, and these can work out to be higher than an interest charge. 

Caution: Earlier we gave an example of paying off an $80 bill over five months using Humm's Bpay option, and being slugged with $40 in fees for the privilege.

If you put the same $80 on a credit card charging a high 20% interest rate and paid it off over the same five-month period, you'd only pay around $4 in interest – and that doesn't take into account the interest-free period that most cards have. 

We don't think you should put your bills on a credit card either, but this just goes to show how fees can add up. It's a good idea to weigh up the costs and see if Humm is the best option for you financially before signing up.

What are Humm's fees? 

Humm charges various fees including monthly and late fees. When making a purchase using Big Things you'll be charged an establishment fee. If you make an additional purchase using Big Things, a repeat purchase fee applies instead. 

Humm may also charge a collection fee every time they try to collect an overdue payment, as well as "any reasonable enforcement expenses ... when enforcing the Contract after a Default". 

Any Humm account can be considered in default if:

  • the payment is more than two business days late
  • you've provided misleading or incorrect information 
  • you are insolvent
  • they believe that you have committed fraud on your account.  

Humm does have annual fee caps of $200 for the first 12 months and $125 for any subsequent period of 12 months for establishment, repeat purchase and monthly fees. It's not clear from their Ts & Cs whether these caps also include late fees.

Caution: Even with fee caps, on a 60-month payment plan for Big Things you may still pay up to $700 in fees and at least $480 in monthly fees alone.

Humm Card vs Humm credit card 

Humm has a digital card option for Little Things in their BNPL offering, which can be added to Google and Apple Pay. Branded as 'Humm//CARD', it can be used online and instore at retailers that accept Humm. 

Not to be confused with the above, Humm has also partnered with Mastercard to create the Humm90 credit card, which is a separate financial product with a limit of up to $50,000. 

Caution: While Humm claims the Humm90 card is interest free, this is only for the first 110 days – then you'll be lumped with a whopping 23.99% interest, which is one of the highest rates out there. It also comes with an annual $99 fee which is slightly more ($8.25) per month than the $8 monthly charge for their BNPL platform. As the Humm90 card is a banking product it does fall under the Credit Act – unlike Humm BNPL.

Risks of using Humm

There are multiple risks associated with using Humm and it's important to do your research on whether it's the best option for your financial situation. Below are some of our key concerns related to using the BNPL platform.

Insufficient background checks 

Only checking expenses on amounts over $15,000 is insufficient. While this does a better job at assessing someone's ability to pay than what is assessed on smaller amounts, it is still not a formal credit check such as a bank would do. $15,000 is also a high value for this check to kick in and leaves vulnerable people at risk of financial harm. You could not walk into a bank and get a loan for this amount without a thorough financial assessment. By not conducting full and proper credit checks people may be sold inappropriate financial products that they can't afford. 

Weak hardship policies

Humm's hardship policies are not transparent, are weaker than what is required of a bank, and are at Humm's discretion. If you need to contact Humm for hardship you can do so via the phone or through an online form. But nowhere on their website or in their Ts & Cs does Humm specify what their hardship policy is or how they'll actually help you. 

Financial counsellor Deb Shroot tells us that "we continually get reports of people not getting a response, being unable to contact them, not knowing how and simply being ignored".

Fiona Guthrie, CEO of Financial Counselling Australia, says that their "recent survey of buy now, pay later services showed that Humm is the worst company for helping customers in financial difficulty".

Weak regulation

By charging fees instead of interest, BNPLs are exploiting a loophole in the National Credit Code that means they're not regulated in the same way as other lines of credit – this results in weaker protections for people who choose to use these products.

While Humm are signatories to the Australian Finance Industry Association's (AFIA) new Buy Now Pay Later Code of Practice, we consider this code to be weak. 

Not only is it voluntary, only eight BNPL services have signed on and it is not legally enforceable. 

For example, this voluntary Code specifies that for loan amounts between $15,001 and $30,000 customers need to undergo background checking for expenses and third-party checks that could include either a credit check or "equivalent check" – whatever that means. A credit check is not mandatory and the checks that are carried out to assess someone's ability to pay are self-regulated. This is not good enough.

We think that all people should have the same protections whether they're borrowing money on a credit card, via a personal loan or through a BNPL. 

A risk to the financially vulnerable

BNPL products including Humm often market themselves to young people as being a hip alternative to credit cards and layby. But the reality is that these products are being pushed towards people who may not be financially savvy, and who are more likely to be in insecure work and on lower incomes. 

Because Humm (and others) are not conducting a full background and credit check, credit may be given to people who may not qualify for other lines of credit such as a credit card or a loan.

It's very easy for people to sign up for multiple BNPLs, over-extend, or be unable to make their payments if they get sick or lose work. 

Add to this Humm's high credit limits and weak hardship policies, and vulnerable people are open to significant financial harm.

Humm awarded a 2021 Shonky

In 2021 we gave Humm BNPL a Shonky Award for sketchy background checking to assess affordability, poor hardship policies, sky high credit limits and superfluous Bpay options. 

Not only this, we got different answers every time we put our questions to Humm's online chat agent and the company's head office. 

This makes it exceptionally difficult for people to navigate the service – not even Humm seems to know what their processes and policies are. 

Humm is unregulated credit that puts financially vulnerable people at risk. The BNPL sector needs to be brought into line with other providers of credit. 

Need help?

If you've borrowed money from Humm and are struggling to make the repayments, you can also call the National Debt Helpline on 1800 007 007.

They are a free, independent and confidential service that assists people with debt.

The service helps people clarify their options and offers advice and strategies on how to manage your debts, get access to hardship options and move forward. 

We care about accuracy. See something that's not quite right in this article? Let us know or read more about fact-checking at CHOICE.