According to a report by Bloomberg, the Silicon Valley giant Apple is working on a service to allow buyers to pay for purchases in installments. This step would push Apple into the rapidly rising “buy now, pay later” sector.
The report further entails that the company will collaborate with Goldman Sachs Group as the lender for the loans made via. Apple Pay. Since 2019, the Sachs group has remained Apple’s partner for issuance of the Apple Card credit card.
Apple is Working on ‘Buy Now, Pay Later’ Service: Report
The new service will let Apple Pay users pay for the products via a total of 4 interest-free payments which will have to be paid after every two weeks. On the other hand, you can also choose a monthly plan but then you will have to pay back with interest.
In the United States, Australia, and Europe, BNPL (buy now, pay later) is being promoted as an alternative to credit cards. The service has gained immense popularity amidst the COVID-19 pandemic as users look for alternatives to make purchases that are convenient on their wallets.
However, the prospect of going up against a big company like Apple and PayPal is likely to test Australian pure-play BNPL companies that have so far gone unmatched the U.S. market. According to Wedbush Securities analyst Moshe Katri,
We believe the concerns over the competitive impact of added BNPL offering by Apple are overblown. All these Centre companies, including PayPal, Affirm already built ecosystem offering products and services around the merchants they serve. BNPL is just another product or service offered to merchants as a natural extension of Apple’s ecosystem.