Apple is constantly looking for ways to expand the reach of Apple Pay’s payment offerings, whether it’s in stores, online, or anywhere money is exchanged for goods and services. So it’s no surprise that the launch of iOS 16 and an updated Wallet app signaled Apple’s entry into the Buy Now Pay Latter (BNPL) space with Apple Pay Later.
It’s a crowded space to be in, with services like Klarna, Afterpay and Affirm among the most popular options, and fintech giant PayPal offering its own. PayPal Pay at 4 Payment plan. So Apple expects to face some tough competition when Apple Pay launches later in the fall.
Here’s what we know so far about Apple Pay Later and how it will fit into the Wallet app.
What is Buy Now Pay Later
BNPL is a simple concept: instead of paying for your purchase all at once, you pay in installments. Usually, these premiums will be offered without interest, which is why they can be very attractive to consumers. Some, like My hunt plan (Opens in a new tab)does charge a fee, but Apple said Apple Pay Later won’t include any fees.
How does Apple Pay Later work
Based on what Apple said when it unveiled the BNPL service at WWDC 2022, you don’t need an Apple Card to use Apple Pay later, but you have to use Apple Pay. Apple warns that “the bank that issued the user’s card may charge a fee if the user’s debit card account has insufficient funds,” but apart from that, there are no restrictions that we know about.
Although it is not required, you may still want to sign up for Apple Card account anyway. Both Apple Card and Apple Pay Later are technically offered by Goldman Sachs, although users perceive everything to be Apple-branded.
Once you use Apple Pay, it seems like all you have to do next is simply make a purchase with Apple Pay. There may be some purchases that are not eligible for Apple Pay Later, but details about these restrictions will likely come out near the launch. This feature should also work for contactless payments made with your iPhone or Apple Watch.
Once you’ve made a purchase with your Apple Card, you can select either “Pay in full” or “Pay later.” If you select Pay Later, you will be given a scheduled payment plan that shows details of your four payments.
Each Apple Pay Later purchase is split into four equal payments over six weeks. The first payment is made once Pay Later is selected, subsequent payments are scheduled every two weeks. All payments are handled through the Wallet app.
Where can I use Apple Pay later
According to Apple, Apple Pay Later will work anywhere Apple is accepted online or within an app. This appears to exclude physical stores from BNPL purchases.
Who can sign up for Apple Pay later
Apple Pay Later is currently set for US users. Additionally, users must apply to use the feature and can only use it after their request is approved.
It’s not clear when other regions will be able to access Apple Pay later, but Apple usually tests payment features in the US before bringing it to other countries.
When can I sign up for Apple Pay later
This feature is expected to be released with iOS 16. This software update is currently in beta, with developers getting their first crack. A public beta is coming in July, but we think Apple Pay Later won’t launch until after iOS 16 gets the full version in the fall.
What else do I need to know about Apple Pay next
Apple Pay Later is technically a line of credit. However, the application process should only require a flexible credit check, thus not affecting the credit score of the applicant. While there’s no fee with Apple Pay Later, default will likely result in a fine of some sort. Therefore, you should not use Apple Pay later unless you know you can make each of the four payments on time. This rule applies to any BNPL service.
Stay in touch with Tom’s Guides for the latest updates on iOS 16 features coming to your phone later this year.
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