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08/31/2021

Amazon Taps Affirm for Buy-Now-Pay-Later Option

Amazon has teamed up with Affirm to let qualified customers pay for their purchases over time.
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Financial technology company Affirm operates as a financial lender of installment loans that enables customers to pay for their orders in monthly installments. Numerous retailers, including David’s Bridal and Neiman Marcus, have partnered with Affirm and other companies that offer similar buy-now-pay-later (BNPL) services as e-commerce has boomed, Chain Store Age reported. 

With Amazon, customers have the option to split up the total cost of their purchases when the amount is $50 or higher into monthly installments through Affirm. Customers can see what they pay upfront and won’t have to pay anything higher than what they agreed to at checkout. In addition, there are no hidden or late fees.

Executive Summary

Amazon’s adoption of the buy-now-pay-later payment option underscores the willingness of the e-commerce giant to be more flexible as digital shopping channels continue to grow. Amazon already offers the Afterpay flexible payment option through the Afterpay mobile app to pay for purchases in four monthly installments.

“By partnering with Amazon we’re bringing the transparency, predictability and affordability that Affirm provides today to the millions of people who shop on Amazon.com in the U.S.,” said Eric Morse, senior vice president of sales at Affirm. “Offering Affirm’s alternative to credit cards also delivers more of the payment choice and flexibility consumers on Amazon want.”

Exec summary

The adoption comes as younger consumers are more eager to utilize BNPL options. Millennials and Gen Z account for 42.7% and 30.3% of BNPL volume, respectively, according to recent data from eMarketer. Plus, BNPL is likely to continue growing and account for more than 24% of global e-commerce transactions for physical goods by value by 2026, CSA reported. That’s up from 9% of transactions in 2021.

See the full story at Chain Store Age.