Apple is rolling out its own buy now, pay later (BNPL) option in an effort to make a place for itself in the payment installment arena, according to Washington Post.
Apple’s BNPL option will allow consumers to finance a purchase up to $1000 in four installments over six weeks, with no interest or fees. It will be phased into general use over the next couple of months.
Apple has been competing with traditional financial institutions for some time now, particularly in regards to digital wallets.
Digital wallets are more popular than ever, with device-specific wallets such as Apple Pay and Google Pay competing with operating system-agnostic wallets, such as PayPal’s Venmo. Traditional banks have also been eyeing the space. Just earlier this year, Wells Fargo, Bank of America, and JPMorgan Chase—in addition to four other financial institutions behind Zelle—said they were teaming up to launch a digital wallet.
All of these major players are building out their own financial ecosystems, with BNPL options, and will likely reach parity, according to Christopher Miller, Lead Analyst of Emerging Technologies at Javelin Strategy & Research.
The move by Apple to enter the BNPL market is yet another sign of the rapid evolution of the payments industry, where the convergence of technology and finance is fueling innovation and competition. BNPL options have gained significant traction in recent years, especially among younger consumers, who are looking for alternatives to credit cards and traditional loans. The pandemic has only accelerated this trend, as more consumers are shopping online and looking for flexible payment options.
Apple’s efforts will likely have a significant impact on the industry, given the company’s large customer base and brand recognition.