NEW YORK (AP) — The layaway wars are heating up ahead of the winter holidays.
Kmart, a division of Sears Holdings Corp., said Friday that it's waiving the fees that shoppers pay to open its interest-free pay-over-time program at its discount stores and online through Nov. 17.
The parent company, based in Hoffman Estates, Ill., plans to do the same for its Sears, Roebuck and Co. stores, but Jai Holtz, vice president of financial services for Sears Holdings, says it's still finalizing the time frame. Both Kmart and Sears have charged $5 for an 8-week layaway contract and $10 for the 12-week program.
Kmart's move comes three days after Wal-Mart Stores Inc. said it was lowering its holiday layaway program fee to $5 from $15. It had said that it was reacting to customers' feedback since announcing in July it was resurrecting its holiday layaway program. The new program, which starts Sept. 16 and runs through Dec. 14, will last a month longer than last year's and will include more items than the toys and electronics featured last year. Shoppers who make their final layaway payment will get a full refund of the fee in a form of a Wal-Mart gift card.
Toys R Us Inc. said Monday it was eliminating the upfront service fee for layaway orders created in store from Sept. 4 through Oct. 31. After Oct. 31, a $5 service fee will apply.
Holtz noted that Kmart's decision to waive the fee wasn't in response to other rivals' moves. In fact, Kmart had been testing the no-fee program in 80 of its 1,200 Kmart stores across the country during the past few months, and it had been well received by shoppers.