Apple device users will soon have the option to utilize buy now, pay later loans from Affirm for their purchases. This collaboration between the two companies will allow U.S. Apple Pay users to access Affirm as a payment choice on their iPhones and iPads. The partnership aims to combine the convenience and security of Apple Pay with the flexibility and transparency that Affirm offers its users.
The addition of Affirm as a payment option on Apple devices is expected to be a significant boost for both companies and the buy now, pay later sector as a whole. Despite initial concerns that Apple’s own BNPL product would overshadow standalone providers like Affirm, this partnership highlights the unique offerings that Affirm brings to the table. Apple’s BNPL loan may have a shorter repayment period, but Affirm provides users with a variety of longer-term payment options.
According to Mizuho Securities analyst Dan Dolev, Affirm’s strong brand and advanced underwriting technology give the company a competitive advantage that Apple could not easily replicate. This suggests that Affirm’s approach to BNPL loans has a certain level of sophistication that sets it apart in the market. Additionally, traditional credit card companies have started to offer BNPL-style installment loans in response to the growing popularity of these services during the Covid-19 pandemic.
The news of Affirm’s partnership with Apple had a positive impact on the stock market, with shares of both companies experiencing an increase in value. Affirm’s stock rose by 5% in late-morning trading, while Apple’s stock saw a 6.2% increase. Despite this, Affirm anticipates that it will take some time for the partnership to make a significant impact on its revenue. The company stated that it does not expect the collaboration to have a material effect on revenue or gross merchandise volume until fiscal year 2025.
The collaboration between Affirm and Apple to offer buy now, pay later loans to Apple device users signifies a significant development in the fintech industry. By combining the strengths of both companies, users will have access to a wider range of payment options that cater to their financial needs. As the popularity of BNPL services continues to rise, partnerships like this one demonstrate the innovative solutions that companies are implementing to meet consumer demands in the digital age.