Apple is planning to launch its own ‘buy now, pay later’ service allowing users to pay for any Apple Pay purchase in a number of installments.
‘Apple Pay Later’ will reportedly use Goldman Sachs as the loan provider, having has worked with the banking giant since 2019 to provide its Apple Card credit card, Bloomberg reported.
It is understood that Apple Pay Later functionality will be added to the Apple Pay ecosystem in the near future, offering anyone using the service the option to pay for their purchase in four interest-free payments made every two weeks, or across several months while paying interest.
According to unnamed sources close to the matter the service will be available both instore and online, while customers will be able to use any credit card to repay month installments.
The scope of potential adoption is massive, with around 85 per cent of US retailers currently accepting Apple Pay, which is available on all iPhone devices, owned by around 50 per cent of UK smartphone users.
Shares in rival BNPL companies like Afterpay and Zip, some of the biggest providers in the US, fell by nearly 10 per cent on news of the tech giant’s imminent entry into the sector.
Unlike BNPL incumbents such as Afterpay and UK market leader Klarna, Apple Pay Later will not require running a credit check on users, a key point of controversy for the emerging fintech sector.
Instead Apple Pay Layer will require users to be previously approved via an application submitted through the iPhone Wallet app, in which they’ll need to submit a copy of their ID card.
It will also offer users the ability to exit payment plans by paying off the remaining balance, while some plans will exclude late fees and processing fees.
According to Statista, Apple Pay is projected to see global revenues of $4 billion this year, up significantly from $988 million it made in 2019.