Amazon is getting into buy-now-pay-later. The company just announced a partnership with Affirm, a major player in the BNPL space. Starting soon, customers at checkout will see the option to pay in a series of monthly installments on purchases of $50 or more. In a statement, the companies said they have already begun testing the feature with "select customers." It's unclear how many people might see this option early, or in what markets. The companies also did not say when this feature would roll out more widely.
On the financial terms, the companies promise in their statement: "As always, when choosing Affirm, consumers will not be charged any late or hidden fees." An Amazon spokesperson told Engadget in an email that customers must agree to a soft credit check at checkout. The financial terms offered depend on both the person's credit history and the purchase price, she said. Depending on the customer and their order value, they might be offered anywhere from a three- to 48-month payment plan, with interest ranging from 0% to 30% APR.
An Affirm spokesperson added in an email that whatever interest consumers pay related to these loans, they agree to those rates up front, and that interest does not compound.
The move makes sense for Amazon, and is arguably a belated one. Many other brands and retailers already offer buy-now-pay-later options, with CNBC noting that Affirm already serves more than 12,000 retailers, including Walmart. Just recently, too, Square paid $29 billion to acquire Afterpay, another giant in this growing space.
Update: We have added additional details on the financial terms after Amazon and Affirm responded to requests for further comment.