Apple Drops ‘Buy Now, Pay Later’ Service

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Apple sunsets its buy now, pay later service known as ‘Apple Pay Later’, and will rely on established third-party players

Apple is making a notable change to the way users can purchase its devices, after discontinuing an in-house ‘buy now, pay later’ service that had been barely operational for a year.

It was back in March 2023 when Apple made a surprising fintech move, when it launched the ‘buy now, pay later” (BNPL) service in the United States.

The iPad maker called the service ‘Apple Pay Later’, and it allowed Apple Pay users to split purchases of up to $1,000 into four payments with zero interest and no fees.

Apple Pay Later.
Image credit Apple

Apple Pay Later

However the move immediately raised concerns it would put Apple into direct competition with established buy now, pay later services providers such as Affirm Holdings and Swedish payments company Klarna, potentially opening up more antitrust issues for Apple.

Apple Pay Later had been originally announced alongside iOS 16, although it wasn’t included in the initial iOS 16 release.

Apple had rolled out early access invitations to “randomly selected users” in March 2023, but only launched the service fully in the US in October 2023.

Now it seems that not even a year later, Apple is ‘sunsetting’ Apple Pay Later.

Indeed, a visit on the Apple Pay Later webpage confirms the firm is discontinuing its own BNPL service.

“Apple Pay Later is no longer offering new loans for purchases with Apple Pay,” the webpage stated. “Your existing Apple Pay Later loans and purchases are not affected. You can continue to manage your loan and view loan details in Wallet.”

Apple also confirmed the move in a fuller statement to 9to5Mac.

“Starting later this year, users across the globe will be able to access installment loans offered through credit and debit cards, as well as lenders, when checking out with Apple Pay,” said Apple in its statement to 9to5Mac.

“With the introduction of this new global installment loan offering, we will no longer offer Apple Pay Later in the US,” it reportedly said. “Our focus continues to be on providing our users with access to easy, secure and private payment options with Apple Pay, and this solution will enable us to bring flexible payments to more users, in more places across the globe, in collaboration with Apple Pay enabled banks and lenders.”

Third parties

Apple is essentially turning the popular buy now, pay later service option over to third party firms.

At its annual developer’s conference earlier this month, Apple had confirmed that Apple Pay users would be able to access new installment loan offerings in the Autumn.

This would include the ability to apply for BNPL loans directly through US-based Affirm when they check out with Apple Pay.

There is no word yet as to whether Apple will offer a similar option for Swedish payments company Klarna.

Apple had introduced Apple Pay to the world back in 2014, and it essentially digitises and replaces a credit or debit card chip and PIN transaction at a contactless-capable point-of-sale terminal, taking a payment immediately.