Buy Now, Pay Later Firms Expand Options for U.S. Consumers
Affirm integrates with Stripe to offer installment payments to millions of merchants, while Klarna launches a physical Visa card to bring its service into physical stores.
Buy now, pay later technology grows increasingly competitive in the United States as companies race to expand their reach. Affirm recently partners with Stripe to offer installment payment options to millions of U.S. businesses using the payment processor's platform. This move allows a vast new segment of merchants, from startups to large corporations, to provide their customers with flexible payment plans.
For Affirm, this integration represents a significant revenue opportunity since the company earns money through interest fees on these transactions. The company, founded by PayPal co-founder Max Levchin, positions itself as an alternative to traditional credit cards by underwriting individual transactions and offering biweekly or monthly payment schedules. Meanwhile, Stripe benefits by adding more payment flexibility to its existing services.
Klarna takes a different approach to expansion by teaming up with Marqeta to introduce a physical Klarna Card in the U.S. This Visa card brings the popular "Pay in 4" service out of online checkouts and into physical retail stores. This shift reflects a broader trend in the financial industry, with major credit card networks like Visa and Mastercard also developing their own installment offerings to meet consumer demand for greater payment control.