Attention Walmart shoppers: proceed to your mobile phones to apply for a point-of-sale financing offer. The mega-store and fintech Affirm announced an arrangement to offer in-store shoppers another way to pay for merchandise, as the following American Banker article reports.
Walmart will offer its customers point-of-sale loans for the first time — both on its website and in nearly 4,000 U.S. stores — under a partnership with Silicon Valley lender Affirm.
The deal marks a watershed moment for the consumer finance industry, as the nation’s largest retailer embraces a financing option that is being popularized by consumers who prefer not to put their big-ticket purchases on a credit card.
“Affirm is a great financing option for those customers who may prefer a fixed-term loan versus an open-ended revolving credit line to pay for larger baskets,” Walmart spokeswoman Marilee McInnis said in an email. “We want our customers to have choices that best meet their lifestyles.”
The partnership, which was announced Wednesday, represents a coup for privately held Affirm. The San Francisco company makes loans to customers of more than 1,800 merchants — including Expedia, Orbitz, Wayfair and Cole Haan — but Walmart is expected to quickly become its biggest retail partner.
Under the deal, Walmart shoppers will be able to get Affirm loans of three, six or 12 months to finance purchases ranging from $150 to $2,000. The loans are already being offered in Walmart stores, and they will be available to Walmart’s online shoppers in the coming weeks.
This is certainly a big win for Affirm as it continues on its solid growth trajectory for alternative consumer financing. Nothing like teaming up with Walmart to give sales volume a little boost. Walmart will get a lift as well with shoppers who might be tapped out on credit cards could find another way to buy that 75 inch, 4K Ultra HD TV. Another attractive feature is how Affirm is enabling this whole thing via mobile phone access. Will be worth watching what kind of results come out of this new partnership.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group