Apple, Goldman Plan 'Buy Now, Pay Later' Service To Rival Affirm

Apple is working on a new service that will let consumers pay for any Apple Pay purchase in installments over time, rivaling the "buy now, pay later" offerings popularized by services from Affirm and PayPal. From a report: The upcoming service, known internally as Apple Pay Later, will use Goldman Sachs Group as the lender for the loans needed for the installment offerings, according to people with knowledge of the matter. Goldman Sachs has been Apple's partner for the Apple Card credit card since 2019, but the new offering isn't tied to the Apple Card and doesn't require the use of one, said the people, who asked not to be named discussing unannounced products. The buy now, pay later system could help drive Apple Pay adoption and convince more users to use their iPhone to pay for items instead of standard credit cards. Apple receives a percentage of transactions made with Apple Pay, driving additional revenue to the company's more than $50 billion per year services business.

Not a good sign for the economy

[rsilvergun]

that these kind of services are taking off.

Re:

[gweihir]

Not really. The targets for this are people that are unable to handle money competently and that will buy things they cannot afford and actually do not need with it. This way the vendor gets the purchase.

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[Rinikusu]

Depends on the setup. I use something similar that offers no fees and no interest if paid before, say, 12-36 months depending upon the vendor. I could pay cash, but I'd rather take the free money. Hell, the inflation alone takes a dent out of the taxes. I get the item (usually synthesizers), they get the sale, and we all win in this case.

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[gweihir]

Well, there is certainly a minority that does not fit the victim profile, but that they cannot really keep out....

What's the difference?

[cayenne8]

I mean, unless this new plan allows you to pay installments that are interest free....then exactly what is the difference between this plan and a credit card?

What are advantages/disadvantages?

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[Merk42]

It's better because Apple.

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[gweihir]

You get an additional credit amount that you can use to buy things you cannot afford...

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[The New Guy 2.0]

The Apple Card is a full-featured MasterCard, this is a credit offer only good on Apple direct-sales which presumably have lower rewards, so lower interest.

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[ewibble]

but the new offering isn't tied to the Apple Card and doesn't require the use of one, said the people

So it is a new line of credit, I think the grandparent post is right just another way to extend more credit so people spend more money, so apple makes more money.

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[The New Guy 2.0]

Most stores disallow store credit loans to cardholders of the store affinity card.

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[Stolovaya]

At least with Affirm, I think you can get on that service more easy than a credit card since you're not opening a line of credit or anything. It's just for the amount of the item.

I've used Affirm for a few things (mostly phones). In those situations, I wasn't charged any interest.

So for the consumer, it seems easier to get and, potentially, has lower interest than credit cards.

I imagine for Apple, this is fewer credit card fees, so even if they don't charge interest, the volume of business they do (and f

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[cayenne8]

As far as I know, the Apple Card doesn't have a fee.

No annual charge to just have the card.

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[Stolovaya]

There may not be an annual fee, but there's still an APR on the Apple Card, so if you don't pay it off right away then there's a fee.

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[fermion]

Chase introduced something like this a while back. The advantage to the card holder is that the total cost is known up front, as the interest charges are built in. The other, real advantage, is sometimes the interest charged is slightly less that the one the cardholder would normally pay. It also provides an incentive to be more responsible, as may promote a payment above the minimum.

The advantage to the bank is that most people will no make the monthly installments. Therefore the banks gets to charge

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[phalse phace]

They can be interest free if you have good credit, but they can also run as high as 30 percent. If you qualify for zero interest, that's better than using a credit card. And there's no late fee if you're late or miss a payment.

Affirm says about one third of loans are at zero percent [cnbc.com].

More info [nerdwallet.com]

Makes sense

[Waffle Iron]

You're going to need to buy your stuff on installment after you've shelled out enough money to pay for an iPhone.

apple loan shark only 30% APR

[Joe_Dragon]

apple loan shark only 30% APR

lol banks

[RegistrationIsDumb83]

Poor person who wants a loan for some dumb overpriced phone? No problem. Poor person who wants a loan for a house so they can escape renting? Fuck off, says the banks.

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[VeryFluffyBunny]

Poor person who wants a loan for a house so they can escape renting? Fuck off, says the banks.

Naah. They tried that at scale. Caused the 2007-8 financial crisis. Banks aren't there to help people. They're there to maximise shareholder value for their owners & executives even if it means knowingly causing a financial crisis.

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[bn-7bc]

yes because risking ~$1K is exacly the same as risking $70K++++ for an apartment or a house, that might be blown over by a hurricane or blow down etc.

What could go wrong?

[VeryFluffyBunny]

...and cue a new financial crisis in 5, 4, 3, 2, 1...

This sounds an awful lot like they're trying to circumvent due diligence & the usual credit checks that are required for credit cards & loans & the like. On the plus side, maybe this'll bring Apple down? We've already seen that Goldman Sachs can do all kinds of financial fuckery on a massive scale & get away with it scot free & even keep the profits.

Aaah, another debt trap!

[BAReFO0t]

The age old tale of shortsightedness.