Several big BNPL related stories this week, so I'm giving BNPL it's own section. Here's what's new with in the buy now, pay later industry.
- Splitit teamed up with DXC Technology to enable banks to offer BNPL installment payments directly from customers' existing bank accounts or debit cards, without new apps or loan approvals needed. The system runs on DXC’s Hogan core banking platform, which already supports over 300M bank accounts, allowing banks to quickly add installment options both online and in stores. The partnership helps banks compete with BNPL providers like Klarna, Afterpay, and Affirm.
- Mastercard expanded its Installments Payment Services to include Citi’s U.S. credit card portfolio, allowing millions of Citi cardholders to split purchases into fixed monthly payments directly at checkout through Citi Flex Pay. Citi is the first U.S. issuer to join Mastercard’s installment platform, which lets customers choose pay-over-time options online, in apps, or via digital wallets, without additional credit checks or applications. 74% of U.S. credit cardholders say they’d prefer cards offering installment options, as opposed to having to use a dedicated BNPL service.
- Affirm extended its existing relationship with Wayfair, integrating its BNPL option directly into the retailer's checkout experience. The two companies have partnered since 2017, however previously, Affirm was one of several third-party financing options that shoppers could use through Affirm’s own checkout flow, often after being redirected or during certain high-ticket purchases. The new “expanded partnership” means Affirm is now natively integrated directly into Wayfair’s checkout across all its brands including Wayfair, Joss & Main, AllModern, Birch Lane, and Perigold, rather than being an optional, secondary financing path.
- Affirm also expanded its partnership with payment services provider Worldpay, which will integrate Affirm into its embedded payments offering for software platforms. Worldpay for Platforms provides embedded payments for more than 1,000 SaaS companies, and over the last 12 months has processed more than $400B in payment volume and 4.6 billion in transactions. Wow, big partnerships for Affirm! No wonder my stock is doing well.
- Lastly with Affirm news… the company says it wants the U.S. to find ways to cap late fees on pay-later loans. Affirm co-founder & CEO Max Levchin said in an interview with Financial Times that limits on fees for BNPL payments would let leaders focus on their underwriting models rather than banking on missed payments. He added that “Everyone in the industry who uses late fees is basically just covering up or the fact that they're not very good at underwriting.” Shots fired!