Target is the latest major retailer to adopt fintech firm Afterpay Touch's online lay-by payments system.
Afterpay will be available on the retailer's online store and for click & collect purchases later this month.
The new deal comes hot on the heels of Afterpay's partnership with Jetstar, in which the airline will offer customers Afterpay on its website for domestic flights as part of a trial.
Afterpay's service is already being used by more than 7,200 retailers including Myer, Cotton On, Cue, The Just Group, Sephora, BCF and Toys R Us.
The company's chief executive and founder Nick Molnar said lay-by has long been a core offering for department stores, and the partnership with Target will help the group to continue to expand its reach.
Shares in Afterpay initially rose on news of the Target agreement, but at the close of trade were down four cents at $4.11.
Afterpay merged with another payment platform, Touchcorp, in March and was renamed Afterpay Touch before relisting on the ASX at $2.50 per share.
Afterpay pays the retailer for the purchase, and the customer pays fortnightly instalments to Afterpay, with the benefit of no interest payments or up-front fees, over a maximum of 56 days.
Late fees are incurred if payments are missed.
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