- Affirm stock fell 6% on Monday after Apple announced its own Buy Now, Pay Later payment option.
- Apple Pay Later allows users to split the cost of an Apple Pay purchase into four equal payments with no interest.
- The new offering from Apple works with any merchant that already supports Apple Pay, and does not require a new POS terminal.
Affirm stock sank as much as 6% on Monday after Apple announced its own buy now, pay later payment option at its annual WWDC event.
Apple announced Apple Pay Later, which is fully integrated into Apple's digital wallet and allows its users to pay back any purchase made with Apple Pay in four installments. Apple said its buy now, pay later option boasts zero interest rates and no late fees.
The new payment option from Apple has long been rumoured, which is perhaps why Affirm pared its losses and traded down just 3% about one hour after Apple's announcement. Still, Affirm is down 75% year-to-date, and is off more than 86% from its 52-week high.
Apple Pay Later is available wherever Apple Pay can be used, including for in-app purchases and shopping on the web. Additionally, the new payment installment plan is fully integrated with existing point-of-sale terminals, so retailers won't need to upgrade their POS systems to enable Apple Pay Later.
Any purchase made with Apple Pay Later can be tracked and managed through the Apple Wallet app on the iPhone. Apple's first foray into the buy now, pay later space was with its Apple Credit Card, which allowed users to make monthly installment payments with 0% interest for specific Apple products purchased at Apple Store locations.
Now Apple will compete with the likes of Affirm, Klarna, and Afterpay in the buy now, pay later space, but Apple highlighted its plans to launch the service were more of an effort to help its iPhone users completely replace their physical wallet. The company is working towards that goal by launching state-approved digital drivers licenses, among other features.
Apple stock traded up half a percent in Monday trades. The company also unveiled new MacBooks, and iOS 16 for the iPhone. Speculation has mounted that Apple may unveil an augmented reality product. The conference is still ongoing.