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Apple Device users will soon be able to buy loans now and pay later Confirm for purchases, the companies announced on Tuesday.
Affirm will appear as an option for U.S. Apple Pay users on iPhones and iPads later this year, the San Francisco-based fintech company said in a filing. Apple confirmed the news in its own update.
“This provides users with additional payment options and offers the simplicity, convenience and security of Apple Pay, as well as the features that users love about Affirm – flexibility, transparency and no late or hidden fees,” Affirm said in an email statement.
The move strengthens Affirm and the buy now, pay later sector in general. When Apple unveiled its own BNPL product last year, investors feared the tech giant would crowd out standalone providers like Affirm. But the fact that Apple has decided to allow Affirm products in its ecosystem shows that the fintech company has something unique to offer.
For example, while Apple’s BNPL loan allows purchases to be repaid in four installments over six weeks, Affirm offers a range of longer-term deals that can be repaid over a year or more. The companies did not provide any information about the conditions of the new loans.
“The bottom line – in our view – is that Affirm’s strong brand and sophisticated underwriting technology create a moat that Apple alone would likely not be able to replicate,” Dan Dolev, an analyst at Mizuho Securities, said in a research note.
Citi, synchrony
Apple also said credit and debit card installment loans would be available on Apple Pay in the US Citigroup, Synchronicity And Fiserv-related issuers. Traditional credit card providers have started offering BNPL-style installment loans after their popularity surged during the Covid pandemic.
Thanks to the ubiquity of the iPhone, Apple Pay has more than 500 million users around the world and a leading market share in the United States for its mobile payments and digital wallet platform.
Shares of Affirm rose 5% in early trading on Tuesday, while shares of Apple rose about 5.3%.
Affirm shares rose even as the company said it would take some time for the partnership to significantly increase its revenue.
“Affirm does not expect this partnership to have a material impact on revenue or gross merchandise volume in fiscal year 2025,” the company said in the filing.
This story is developing. Please check back for updates.
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2024-06-11 15:04:37
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