Amazon would be about to give a twist to its payment methods after associating with Affirm, so that in the not too distant future it would be entering the universe of buy now and pay later, this being the first option of installment payments in the successful company of electronic commerce.
The ‘Affirm’s Buy Now, Pay Later Checkout’ purchase option is expected to be available initially to select Amazon customers in the United States starting this Friday, but with a much wider rollout in the coming months.
This partnership will allow Amazon customers to break purchases of $ 50 or more into smaller monthly installments. The interesting thing about this association is that, according to its release, is that only some of the loans to Amazon customers will accrue interest, but some will come with 0% APR.
“Approved customers are shown the full cost of their purchase up front and will never pay more than they agreed to at checkout. As always, by choosing Affirm, consumers will not be charged any hidden or late fees, ”the statement reads.
For his part, Eric Morse, Affirm’s senior vice president of sales, said that “By partnering with Amazon, we are bringing the transparency, predictability and affordability that Affirm provides today to the millions of people who shop at Amazon.com in the US. . UU. “, Also indicated that” Offering the Affirm alternative to credit cards also offers more payment options and flexibility that Amazon consumers want. “
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After the partnership was made public, Affirm’s shares soared as much as 47 percent after business hours on Friday, CNBC noted, “adding more than $ 8 billion to its market capitalization.”
No doubt this association is the signal that in many parts of the world the credit space boom continues to take shape as younger consumers adapt these alternative lines of credit.
Despite the fact that loans on credit or installments have existed since before the creation of Amazon, without a doubt the entry of the most important e-commerce store to this system will cause interest in it to be greater, especially at a time when that other big companies in the market and fintechs increase competition by launching their own “pay later” versions of articles online.
Affirm is one of the most popular installment payment options on the market. Works with more than 12,000 merchants, including Peloton and Walmart. Similarly, PayPal, Klarna, Mastercard and Fiserv, American Express, Citi, and JP Morgan Chase offer similar loan services.
Last month, according to Bloomberg, it was reported that another technology company would be in plans to launch installment loans in partnership with Goldman Sachs.
Will it arrive in Mexico?
At the moment it is very early to know if this new payment method will reach Mexico or other countries, however, it is not ruled out that in the not too distant future it may land in other markets outside the United States.
It is important to say that, at least in Mexico, this payment method is one of the most recurrent and that it has made stores like Coppel and Elektra have a large list of consumers due to their characteristic “small payments”, which they offer so that consumers buy products with small monthly payments over very long periods of time, and with few requirements.
According to the website of Differs, Coppel and Elektra are two well-known stores in Mexico, where they can be found products Similar items such as clothing, shoes, furniture, appliances, and even cash loans.
Their accessibility has allowed them to gain a lot of popularity and clientele, mainly to the less favored economic classes, however, both show a high amount of interests.
If Amazon comes to use this payment model, there is no doubt that competition for the consumer will intensify in Mexico.