Retail & Consumer

Affirm soars on buy now, pay later pact with Amazon

2 minute read

Small toy figures are seen in front of diplayed Amazon logo in this illustration taken March 19, 2020. REUTERS/Dado Ruvic/Illustration

Aug 27 (Reuters) - Affirm Holdings Inc (AFRM.O) shares surged 43% on Friday after the company partnered with Inc (AMZN.O) to make its buy now, pay later (BNPL) service available to certain customers of the e-commerce giant.

Marketed as an alternative to credit cards, BNPL services have soared in popularity during the pandemic as consumers seek options that make purchases easier on their wallets.

Jack Dorsey's Square Inc (SQ.N) this month agreed to buy Australian BNPL pioneer Afterpay Ltd (APT.AX) for $29 billion and a report said in July that Apple Inc (AAPL.O) and Goldman Sachs (GS.N) were readying a version of the service. read more

Affirm's tie-up will allow select Amazon customers to split the total cost of purchases of $50 or more into simple monthly payments using its service. The feature will roll out to more customers in the coming months.

The nine-year-old company has become one of the most well-known BNPL firms in the United States and its partners include Adidas AG (ADSGn.DE), Shopify Inc (SHOP.TO) and Walmart Inc (WMT.N).

Affirm charges merchants a fee to offer small point-of-sale loans which shoppers repay in installments, bypassing credit checks.

Shares of Affirm, which debuted on the Nasdaq in January, were at $97 in extended trading.

Reporting by Eva Mathews in Bengaluru; Editing by Aditya Soni

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