Affirm has announced new buy now, pay later (BNPL) options to offer consumers more flexibility in their payment choices. The new plans, Pay in 2 and Pay in 30, allow users to split payments into two interest-free installments or complete their purchase within 30 days without interest, respectively. This move is partly driven by the fact that 80% of U.S. e-commerce transactions are under $150 and that around 30% of non-farm workers are paid biweekly or monthly. Affirm's 16.4 million U.S. users now have alternatives to the traditional Pay in 4 model, enhancing their ability to manage payments according to their financial schedules.
The company emphasized the importance of offering greater choice and flexibility to meet consumer needs effectively. This development comes amidst regulatory scrutiny from the Consumer Financial Protection Bureau (CFPB), which now requires BNPL providers to adhere to credit card regulations, including monthly statements and transparent reporting of any interest or fees. Despite these guidelines, Affirm maintains that it aligns with responsible credit extension, emphasizing its commitment to no late or hidden fees.
The BNPL sector faced some market pressure following the CFPB ruling, but Affirm continues to expand its presence, recently partnering with the Sensepass platform. This partnership integrates Affirm's services with 100 wallets, including popular options like Venmo and WeChat Pay. Affirm's BNPL products are now available at over 292,000 U.S. merchants, including major retailers like Walmart, Amazon, and Target. Early tests of Pay in 2 and Pay in 30 options have shown increased cart conversions, and these options will be rolled out to Affirm’s retail partners in the coming months.
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