Buy now, pay later (BNPL) is a form of financing that traces back to the 19th century, when installment plans emerged as a way for consumers to buy expensive goods they couldn’t afford to buy outrightly. This is a type of short-term financing that allows consumers make purchases and pay for them as a future date, the parties involved are the consumers, financiers, and sellers. In this 3-way agreement, financiers pay sellers on behalf of the consumers when good or services are purchased, and these payments are repaid by the consumer over an agreed upon time depending on the financier.
Apple, an American multinational technology company headquartered in California, is the largest technology company by revenue, totaling US$394.3 billion in 2022. As of March 2023, Apple is the world’s biggest company by market capitalization. The technology giant announced the Buy Now, Pay Later feature, called Apple Pay Later, which would allow customers split payments for purchases into four installments over 6 weeks, with no interest and no fees, but the first payment will be required at the time of purchase.
According to Apple, this new feature was designed with users’ financial health in mind, as it offers flexible payment options and makes it easier for users to make informed and responsible borrowing decisions. Users can apply for loans of $50 to $1,000 from their apple wallet and with no impact to their credit, which can be used for online and in-app purchases made on iPhone and iPad with merchants that accept Apple Pay.
Apple Pay Later is a welcome addition to the world of financial technology, offering users more flexibility and control over their purchases and loans. With its easy-to-use interface, transparent terms, and strong privacy protections, Apple Pay Later is sure to be a popular choice for many iPhone and iPad users in the coming months and years. This payment option is being rolled out to random select users in the United States, with hopes of expansion in the near future.