Apple spreads its financial muscles by launching the Buy Now Pay Later service

Buy Now Pay Later (BNPL) or Buy by Installment is growing in popularity, as it is a convenient solution for consumers who need to buy products but do not want to pay the full amount right now.

This service is a type of short-term financing, allowing consumers to get the products they need by paying for them in installments at a later date.

This service helps balance the consumer's need for products and their ability to pay for them, while allowing merchants to increase sales and expand the customer base. Overall, this service is an interesting option for consumers looking for flexible payment solutions.

In the last decade, many buy-now, pay later companies have emerged, and these companies have been able to succeed thanks to the expansion of the user base and the change in people's financial and purchasing culture.

There are many Buy Now Pay Later service providers, such as Klarna and Afterpay, as well as PayPal (PayPal) via PayPal Credit.

In recent years, the popularity of this type of service has increased, and according to the data released, the size of the installment purchase market reached about $ 120 billion in 2021.

While companies operating in this field are trying to expand their services in different markets around the world, there are a number of technology companies trying to enter this market and expand their services within it, including Apple.

Apple and the premium feature

Apple entered this field for the first time in 2020 by launching the Apple Card Monthly Installments-based Apple Card feature.

The "Apple Card Monthly Installments" feature allowed users to purchase the company's products such as iPhone, iPad and Mac in monthly installments, through which Apple aimed to improve the user experience and increase its sales, as the service provides them with a smooth and convenient shopping experience, making the purchase process easier and more attractive to users.

But it seems that this service was not enough for the company, as it expanded its presence further through the Apple Pay Later, making it the latest company to adopt the "buy now, pay later" installment service.

According to the company, the beta version of the service has become available to select users, with promises to be made available to all eligible users in the coming months.

The company was supposed to launch the installment purchase service at the end of 2022, after announcing it last year at the World Developers Conference (WWDC). However, its launch was delayed due to significant technical and engineering challenges, according to Bloomberg.

The service comes at a time of high inflation and economic uncertainty, but as retailers increasingly accept payments from installment buying apps.

There are many Buy Now Pay Later providers, such as Clarna and Afterpay along with PayPal (Shutterstock).

What is Apple Pay Later?

Apple Pay is part of Apple Pay and allows you to purchase and pay for products over 6 weeks in 4 equal payments with no interest or fees, with the first payment due at the time of purchase, and the remaining payments due every two weeks thereafter.

The new feature is available in the Apple Wallet app on iPhone and iPad for online and in-app purchases, and is currently available in the United States.

For example, if you want to buy shoes from Amazon for $455 and don't want to pay the full amount at once, you can use the service to order the shoe and pay for it in 4 installments, or $113.75 every two weeks, so you pay $455 without any fees or interest. However, you need to pay the first installment on the same day you buy the shoes.

How can I use Apple PayLater?

After downloading Apple Pay Latter on your phone, you have two options when you complete your purchase: pay in full or pay later, and selecting the Pay Later option displays a payment schedule that shows the amount of each of the four payments and when they become due.

You can apply for a loan within the Apple Wallet without any balance impact, and you are then asked to enter the amount you wish to borrow and agree to the terms of the Apple Paylater, and you must be in good financial position before taking the loan.

Once approved, you see the option to pay later when you choose Apple Pay when you pay online and in apps via iPhone and iPad, and you can use Apple PayLater to make your purchase.

The service works with all stores and merchants that accept Apple Pay, and stores or merchants do not need to make any changes to accept payments through Apple PayLater, and the only difference lies in how the remaining payments are made.

Apple created its financial subsidiary, Apple Finance, which handles loan approvals and credit checks, while banking partner Goldman Sachs is the official issuer of the loan.

When you buy a product through Apple PayLater, the merchant receives a 16-digit card number created by Goldman Sachs, showing that the purchase was made via Apple's new financial feature.

Apple PayLater payments are supposed to be made by debit card, as you can't use a credit card.

You can set up automatic payments or make additional payments at any time, and every Apple Paylater purchase is reviewed and approved or rejected using a flexible credit check.

The minimum purchase through Apple Paylater is $50, while the maximum is $<>,<>.

Apple postponed the launch of the installment purchase service, which was scheduled for the end of 2022 (Reuters)

When to launch Apple PayLater?

If you are a select user to receive an invitation from Apple, you can start using Apple PayLater now.

For the rest of the iPhone users, the service is likely to be available to all users of the Apple Wallet app in a future iOS update, according to the wording in the company's press release.

Based on the bimonthly release schedule for iOS updates, all Apple Wallet users will likely access Apple PayLater sometime in May 2023.

Ease of use

In order to make it easier to use Apple PayLater, the company has integrated the service with the Apple wallet, so that you can seamlessly view, track, and manage all your loans in one place.

With Apple Pay Latter available in Apple's wallet, you can see the total amount outstanding for all existing loans, as well as the total amount due in the next 30 days.

You can also choose to see all upcoming payments via Apple's Wallet's calendar feature to help track and plan payments.

Before the payment is due, you receive notifications via Apple Wallet and email so you can plan accordingly.

You are asked to link a debit card from an Apple wallet as a way to repay the loan. In order to help prevent you from taking on more debt to repay loans, credit cards will not be accepted.

The new service considers privacy and security, as purchases are authenticated using Face ID, Touch ID or passcode, and transaction history and loans are not shared or sold to third parties for marketing or advertising.

Each time you make a purchase, the service uses a device-specific number and a unique transaction code. Thanks to this method, Apple does not share your identity or credit card numbers with merchants or store them on your device or within its servers.