Upon approval, the Pay Later option will appear when they select Apple Pay to checkout online or in apps on their iPhones or iPads.
Tech giant Apple (NASDAQ: AAPL) has announced its Pay Later service, enabling users to split their purchases into four payments. The company introduced the service in the US with no additional interest or fees. Users of the Apple Pay Later service will be able to spread their payments into four over a period of six weeks. After the technology company announced the new service on March 28, financial company Affirm (NASDAQ: AFRM), which also offers the same service, closed down 7%.
According to the announcement, Apple Pay Later service users can use Apple Wallet to easily track, manage, and repay their loans. While the loans are between $50 to $1,000, interested persons can use them online or for in-app purchases on iPhone and iPad. However, the loan only supports merchants that accept Apple Pay. Apple said it would begin by inviting select users to try the prerelease version of the Pay Later feature before giving access to eligible users in the coming months
The vice president of Apple Pay and Apple Wallet, Jennifer Bailey, said the new feature is a way to provide flexible payment to people. Noting that there is no “one-size-fits-all approach” to managing finances, she continued:
“Apple Pay Later was designed with our users’ financial health in mind, so it has no fees and no interest, and can be used and managed within Wallet, making it easier for consumers to make informed and responsible borrowing decisions.”
Apple Pay Later
To use the Apple Pay Later feature, users can apply for loans on the Wallet. After inputting the desired amount to borrow, they will also agree to the terms before the application processing begins. Upon approval, the Pay Later option will appear when they select Apple Pay to checkout online or in apps on their iPhones or iPads. At the same time, users can apply for loans in the checkout flow when making purchases, as long as the service is already set up.
The fact that the feature is built into Apple Wallet makes it easier to view pending payments. The amount due in the next 30 days is also visible on the platform. Apple has also designed a feature to send reminders to users ahead of payment due dates.
Apple has assured privacy and security at its peak for all its Pay Later service users. The company said purchases with the new feature are authenticated using Touch ID, Face ID, or passcode. At the same time, transaction and loan history is protected and not divulged or sold to third parties for advertising or marketing.
The news hardly impacted AAPL as the company’s shares traded up 0.03% to $157.70.