Apple kills Apple Pay Later service in US

Apple has been forced into an embarrassing about turn with its BNPL product, Apple Pay Later product, that only launched in the US last year.

Apple kills Apple Pay Later service in US

The cessation of the service is a major blow to the companies ambitions to become a major provider of traditional financial services.

Apple said it was pivoting to a new instalment loan service offered through third-party credit and debit cards. “With the introduction of this new global instalment loan offering, we will no longer offer Apple Pay Later in the US,” Apple said.

Users with open loans through Apple Pay Later will continue to have access to features, but no new loans are being offered.

Apple announced its buy now, pay later (BNPL) offering in 2022 in what represented a major incursion into traditional banking services, with the tech company making short-term loans on its own rather than partnering with a bank.

It gave users the opportunity to pay for online goods and in-app services in four payments spread over six weeks, with the zero-interest loans offered through a wholly-owned subsidiary, Apple Financing.

The move was seen as a challenge to BNPL incumbents such as Klarna and Affirm. Early access started in March 2023.

Goldman Sachs has been the company’s main banking partner since the launch of its Apple Card in 2019, and it facilitates Apple’s access to Mastercard’s network. But the tech group is in the process of winding down the partnership, which also underpins its savings account and credit card offerings.

During its annual developer event, Apple said its instalment loan feature would initially roll out in the UK with HSBC and Monzo banks. In the US it will be available for users of Citi and Synchrony, as well as lenders using software provider Fiserv.

Instalment loans will also be made available on Apple Pay in Australia with ANZ and Spain with CaixaBank.

Apple moved into BNPL market at a time when US interest rates were low and consumers flocked into low-fee loans to fund their purchases. However, the industry has come under pressure as interest rates have risen.


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