Goldman Sachs and Apple are seeking to enter the Buy Now, Pay Later (BNPL) market. A new report is stating that the California tech behemoth is seeking to diversify its financial offerings with a new service within the Apple Wallet ecosystem. Here is what we know so far about Apple’s new financing service, how it works, and when we can expect it to launch.
Apple Set to Launch Buy Now, Pay later Service
The BNPL market seemingly gets more crowded every week. Last week, Splitit launched a new BNPL service that allows in-store financing without taking on new debt or loans. However, even bigger news for fans of BNPL services is coming out this week – with potentially game-changing implications for the sector.
Apple and Goldman Sachs are reportedly launching a BNPL service internally known as Apple Pay Later. The news, first reported by Bloomberg Wealth, states that this new service will allow Apple Pay users to make purchases and pay them off over time, with Goldman Sachs acting as the lender for the loans.
Interestingly, Apple Pay Later will not require an Apple Card to use, an unnamed source in the report stated. Not tying the BNPL service to the Apple Card is a smart move by the tech giant. It encourages iPhone users to adopt the Apple Wallet and payment ecosystem – further strengthening the company’s financial portfolio.
Apple actually benefits financially from users making purchases with Apple Pay, regardless of whether or not they use the its own credit card. The company receives a percentage of all transactions made using its proprietary service – with the company raking in over $50 billion a year from it alone.
How Apple Pay Later Works
Apple Pay Later will take two forms: “Apple Pay in 4” and “Apple Pay Monthly Installments.” The first plan allows users to finance a purchase in four equal installments. The monthly installments version of the plan lets users pay down a purchase over a longer term – likely over set periods such as six, 12, or 24 months.
The Bloomberg article also reports that Apple’s new payments offering will eliminate some of the fees typically associated with BNPL services, but the exact nature of those fees is currently unknown. There is also currently no set launch date for this new service.
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