Apple scraps Pay Later in favour of new global instalments scheme

Apple is discontinuing its "Buy Now Pay Later" service Apple Pay Later in the United States, less than a year after its launch.

The news, originally reported by 9to5Mac comes as the tech giant shifts focus to a new global instalments programme offering loans through third-party credit cards, debit cards and lenders when using Apple Pay.

Starting later this year, shoppers worldwide will be able to access instalment loans provided by eligible cards and finance companies like Affirm at the Apple Pay checkout. Existing Apple Pay Later users with outstanding loans can continue to manage them via the Wallet app, but no new loans are being offered through the service.

"With this new global instalment offering, we will no longer provide Apple Pay Later in the US," an Apple spokesperson stated. "Our focus remains on giving users secure, easy payment options with Apple Pay by collaborating with Apple Pay-enabled banks and lenders to bring flexible financing to more people globally."

The wind-down of Apple Pay Later, which allowed interest-free loans of $50-$1,000 split into four payments over six weeks, marks a retreat from Apple's ambitions to become a major provider of financial services in its own right. The firm had ventured into direct lending last year, positioning Apple Pay Later as a challenger to "buy now, pay later" giants like Klarna and Affirm.

However, the tougher economic climate and rising interest rates appear to have dampened Apple's appetite for the credit risk involved. The buy now, pay later sector has come under strain as costs increase, and regulators have increased scrutiny on the practice.

Apple's new instalments solution will see it return to its core role as a payments platform, integrating with third-party lenders. In the UK, it will work with HSBC, Monzo and others, while US users can access Affirm, Citi and Synchrony loans via Apple Pay.

The company insisted the move will offer "even more flexibility and choice" by allowing rewards redemption and instalment loan access alongside standard Apple Pay transactions.

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