Apple Pay Later, a financial tool that launched in 2023, has already been discontinued. The now-defunct service allowed shoppers to borrow up to $1,000 and pay it back in installments with no interest.
The company said Monday that, starting later this year, Apple Pay will instead allow buyers to access similar small “buy now, pay later” loans via other financial institutions’ credit and debit cards.
Apple Pay Later shuts down: That didn’t last long
While it’s easy to think of Apple as a maker of computers and software, it actually has a lot of plates spinning. One of these is financial services. Apple Pay lets users make transactions from their iPhones and Macs. And don’t forget about Apple Card.
In 2023, the company unveiled Apple Pay Later, a service that allowed consumers to pay off purchases of less than $1,000 in installments with no interest or fees charged. And it wasn’t only for Apple products — the service could be used for any expensive item.
It didn’t last long. Apple sent out a statement on Monday nixing the service.
“Starting later this year, users across the globe will be able to access installment loans offered through credit and debit cards, as well as lenders, when checking out with Apple Pay,” the company said. “With the introduction of this new global installment loan offering, we will no longer offer Apple Pay Later in the U.S.”
Those who currently have a BNPL loan through the service have the same amount of time to pay it off. But no new loans will be accepted.
A financial mystery
Apple did not give a reason for dropping the BNPL service so quickly. Consumers who used Apple Pay Later borrowed the money from Apple Financing LLC. So perhaps Apple CEO Tim Cook and other executives became nervous about exposure to potential loses from customers who didn’t pay back their loans. But Apple execs should have known that going in.
Apple’s statement on Monday painted the shutdown of Apple Pay Later as a win for consumers.
“Our focus continues to be on providing our users with access to easy, secure and private payment options with Apple Pay, and this solution will enable us to bring flexible payments to more users, in more places across the globe, in collaboration with Apple Pay enabled banks and lenders,” the company said.
Apple Pay will let other financial institutions shoulder the burden of potential defaults.
