Apple announced on Monday June 5 the launch of its split payment service. This service will allow Apple Pay users to choose to pay for a purchase in four installments spread over six weeks, without interest or fees of any kind. This system is calledApple Pay Later and will be available wherever Apple Pay is accepted.
How it works ?
The principle is “Buy now, pay later“, that’s to say “buy now, pay later”. When paying, if the consumer decides to pay with their iPhone, he will have the choice of paying now or paying later. The user can choose any credit card, as long as it is registered in the Wallet.
In the Wallet app, users will have a new overview of all their upcoming payments and how much they owe and will be able to define a personal budget.
To use Apple Pay Later consumers will need to submit a copy of their ID card and will need to be approved by the platform.
Apple receives a percentage of the transaction when it is made with Apple Pay, but the partner businesses have said they are ready to pay this percentage of fees for transactions on items that consumers could not have paid for in one go.
This new feature will use the services of Goldman Sachs Group Inc. to make the loans. Apple has partnered with them since 2019 for Apple Pay payments.
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The United States will benefit first
Apple Pay Later will be first available in the United States before the end of the year.
This new feature is part of a set of new tools and improvements that will be automatically installed on iPhones in the fall.
This method of financing would be a less risky alternative to credit cards, which charge interest that is often complicated to understand and can add up quickly. Apple’s goal is to create an easy-to-use, intuitive system that encourages users to use it rather than submit consumer loans.
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This novelty presents risks
The Consumer Financial Protection Bureau (CFPB) said it was “concerned” about theaccumulation of debt, compliance with consumer protection laws and the use of data collected by the companies offering these products.