Apple is readying a new service that will allow Apple Pay users to buy products and pay them off in monthly installments, rivalling existing monthly payment plan options from the likes of Affirm and PayPal. Bloomberg says this feature is in development and internally named ‘Apple Pay Later’.
However, Apple’s service would be directly integrated with Apple Pay. Apple is said to be partnering with Goldman Sachs on the new scheme. Goldman Sachs already serves as the backing bank behind the Apple Card.
‘Buy Now, Pay Later’ offerings are having somewhat of a resurgence in the last few years.
The new feature sounds similar to the program available to Apple Card users. With Apple Card Monthly Installments, Apple Card owners can already buy iPhones and other Apple devices with 0% financing over 24-months.
The new Apple Pay Later scheme will not require Apple Card ownership. Essentially, Apple will soon allow users to easily buy anything with Apple Pay and get it on a monthly financing plan. Goldman Sachs will be the underlying lender of the loans for the instalment plans. Affirm’s stock price plummeted more than 10% on the report being published.
The report indicates customers will have to apply and be approved, through an application process in the Wallet app. Bloomberg says interest-free and interest-accumulating plans will be available:
The service is currently planned to work as follows: When a user makes a purchase via Apple Pay on their Apple device, they will have the option to pay for it either across four interest-free payments made every two weeks, or across several months with interest, one of the people said. The plan with four payments is called “Apple Pay in 4” internally, while the longer-term payment plans are dubbed “Apple Pay Monthly Installments.
The rollout will no doubt draw scrutiny from regulatory bodies, with so many governments eyeing for Big Tech reform. Even before this, the European commission is already investigating claims that Apple unfairly advantages Apple Pay over rival contactless payment systems on the iPhone.
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