A controversial new feature is coming to Apple Pay this year in the US

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By Daniel Jones, Consumer Editor For Dailymail.Com

Published: 10:41 EDT, 11 June 2024 | Updated: 11:00 EDT, 11 June 2024

Apple instrumentality users successful America will soon person nan action to usage arguable 'buy now, salary later' loans from Affirm for their purchases.

Affirm - 1 of nan 3 biggest providers - will beryllium disposable arsenic a costs action for US Apple Pay users connected iPhones and iPads later this year, the companies announced connected Tuesday.

'This provides users pinch further costs choices, and offers nan ease, convenience, and information of Apple Pay alongside nan features users emotion successful Affirm – flexibility, transparency, and nary precocious aliases hidden fees,' Affirm said successful a connection to CNBC.

Following nan news, shares of Affirm roseate by 4 percent successful early trading connected Tuesday, while Apple shares accrued by 2.5 percent. 

Consumer watchdogs interest that BNPL services origin Americans to get into debt. Affirm is 1 of nan 3 main BNPL companies, alongwith Afterpay and Klarna. 

'Apple Pay Later' lets buyers divided a acquisition made pinch Apple Pay into 4 adjacent payments complete six weeks.It launched successful November. Now Affirm is being added 

In  November, Apple rolled retired its ain 'Apple Pay Later' to those aged 18 aliases older.

Thatmove wsa mired successful contention arsenic experts warned it could onshore households successful crippling indebtedness arsenic they are already grappling pinch nan highest surviving costs successful caller memory.

Apple Pay Later lets buyers divided a acquisition made done Apple Pay connected either an iPhone aliases iPad into 4 adjacent payments complete six weeks.

For an approved purchase, nan user would salary 25 percent of nan sum initially and aft that 25 percent each 2 weeks until nan afloat sum is theoretically paid connected nan sixth week. Apple says it charges 'no liking aliases fees'.

A report from nan Consumer Financial Protection Bureau successful September noted that nan number of BNPL loans issued grew almost tenfold betwixt 2019, erstwhile they first gained traction successful nan US, and 2021.

In materials promoting nan caller service, Apple says Apple Pay Later was 'designed pinch users' financial wellness successful mind'. But advocates are skeptical.

'The very usage of nan merchandise itself does lead to a diminution successful financial health,' Nadine Chabrier, elder argumentation counsel astatine nan Center for Responsible Lending, told DailyMail.com astatine nan time.

A research paper published successful October 2022 utilized nan banking information of 10.6 cardinal group to analyse nan financial implications of BNPL. It recovered that users knowledgeable a 'rapid summation successful slope overdraft charges and in installments paper liking and fees, arsenic compared to non-users.'

It besides projected that nan BNPL industry, presently dominated by Fintech companies including Klarna, Affirm, and Afterpay, will beryllium worthy $25billion by 2025.

Chabrier warns Apple is entering a booming but underregulated market. BNPL loans are not classified arsenic 'consumer credit' truthful are not covered by nan Truth successful Lending Act - a 1968 national rule created to beforehand ethical lending. 

'They're not required to measure nan consumer's expertise to repay nan loan, they're not required to disclose nan APR, which helps nan user understand really overmuch in installments costs, and they're not required to person chargeback and conflict authorities that a in installments paper has,' said Chabrier.

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