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Amazon is getting into buying now, pay for space later.
The e-commerce giant is teaming up with Affirm for its first-ever installment payment option on the popular e-commerce site.
Affirmer’s buy it now and pay later option will be available to select Amazon customers in the United States starting Friday with a wider rollout in the coming months, the companies said in a statement. The partnership will allow Amazon customers to split purchases of $ 50 or more into smaller monthly installments.
Shares of Affirm climbed 48% on Friday after business hours, adding more than $ 8 billion to its market cap, while shares of Amazon were unchanged.
Max Levchin, co-founder of PayPal and Affirm
David Paul Morris | Bloomberg | Getty Images
Friday’s partnership is the latest sign of the credit space boom as young consumers turn to these alternative lines of credit. Earlier in August, Square jumped into space with a $ 29 billion deal to buy Australian fintech Afterpay.
So-called installment loans have been around for decades and were historically used for large purchases such as furniture. Online payment players and fintechs have been competing to launch their own version of “pay later†products for items online for a few hundred dollars.
SEE ALSO: Affirm Review: When should you use the Buy Now, Pay Later provider?
Affirm is one of the most well-known installment payment options. He works with over 12,000 merchants, including Peloton and Walmart.
PayPal, Klarna, Mastercard and Fiserv, American Express, Citi, and JP Morgan Chase all offer similar loan products. Apple plans to launch installment loans as part of a partnership with Goldman Sachs, Bloomberg reported last month.
Affirm said some of Amazon’s customer loans will bear interest, but some will have 0% APR.
“By partnering with Amazon, we are bringing the transparency, predictability and affordability that Affirm offers today to the millions of people who buy from Amazon.com in the United States,” said Eric Morse, senior vice president of sales at Affirm, in a press release. . “Offering Affirm’s alternative to credit cards also provides more payment choices and flexibility for Amazon consumers. “
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