Apple Is Shutting Down Its BNPL Service Only a Year After Launch
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Apple recently announced plans to kill off its Buy Now, Pay Later (BNPL) service, Apple Pay Later. The service initially went live only a year ago, but now, the company plans to switch its focus and start collaborating with third parties for installment loans instead.
https://x.com/AppleUpdatei/status/1802768049168322600
What Is Apple Pay Later?
Apple Pay Later emerged during the BNPL craze, which has seen many businesses implement this model. Essentially, the service allowed online shoppers to apply for loans of up to $1,000 during the Apple Pay checkout.
The cost of their purchase would then be split into four equal payments over a six-week period, without additional fees or interest on these postponed payments. Back when it first launched Apple Pay Later, the move was seen as a sign that the firm was distancing itself from its reliance on partners for its growing FS business.
Apple still collaborated with the likes of Mastercard and Goldman Sachs to establish the service, but the service itself was set up as a wholly-owned subsidiary, Apple Financing, which could offer loans to users directly, with no middlemen.
The firm even handled credit checks in-house, going as far as to acquire UK credit bureau Credit Kudos earlier this year to deliver finely-tuned credit scores with its open banking technology.
Apple Shifts Its Focus
However, Apple seemingly decided to shut it down only a year after the feature was released in the US. Instead, it outlined plans for a global installment loan offering through credit and debit cards, as well as BNPL giant Affirm.
https://x.com/AppleUpdatei/status/1802767999759196190
In its statement, the tech giant said: “Starting later this year, users across the globe will be able to access installment loans offered through credit and debit cards, as well as lenders, when checking out with Apple Pay.”
Apple added that the introduction of the new global installment loan offering will officially replace Apple Pay Later in the US. However, the firm also stressed that its focus continues to be on providing users with access to easy, secure, and private payment options with Apple Pay.
Apple believes that the new solution will allow it to bring flexible payments to more users and in more locations around the world. As such, it might be more efficient than the original Apple Pay Later, at least in terms of coverage and accessibility.
As part of its efforts to launch the new service, Apple teamed up with several major banks and lenders. This includes ANZ in Australia, Monzo and HSBC in the UK, CaixaBank in Spain, as well as Affirm, Citi Synchrony, and issuers with Fiserv in the US.
