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Apple Pay Later has arrived in the US, providing customers with the option to purchase products using a “buy now, pay later” business. This service allows Apple users to apply for Pay Later loans ranging from $50 to $1,000 and then pay off those loans in four installments over a six-week period, interest and fee-free.
Apple Pay Later is integrated into the Apple Wallet, which means that users can defer paying the full price of a product upfront. This service was initially announced during WWDC last year, but its launch was delayed due to technical difficulties. However, it is now available to randomly selected users in the US and can be used for online and in-app purchases on iOS 16.4 and iPadOS 16.4.
When applying for a loan, users are not subjected to a credit check. However, according to Apple, the Pay Later loan and payment history “may be reported to credit bureaus and impact their credit.” Once approved for a loan, users can see the Pay Later option at checkout, and they will receive notifications when their payments are due. Users can manage and view their loans through the Wallet app.
Apple Financing LLC, a subsidiary of Apple, is responsible for credit assessment and lending, making this the first time Apple is handling the financial side of things independently. The BNPL program Mastercard Installments was a partner in the process, and Goldman Sachs issued the Mastercard payment credentials. The loans will be reported to US credit bureaus starting in the fall.
Although BNPL services have been criticized for potentially harming customers, Apple claims to be focusing on “financial health.” The Consumer Financial Protection Bureau (CFPB) identified several areas of concern, including inconsistent consumer protections, data harvesting, and the potential for debt accumulation. As a result, the CFPB opened an inquiry into several BNPL companies in 2021 to evaluate their impact on consumers.