Apple Shifts Away from Apple Pay: Focus on “Easy, Secure, and Private” Payment Options

Apple discontinued its Apple Pay Later service, a buy now, pay later (BNPL) financing option, merely six months after its U.S. launch. Originally offered through Apple Financing LLC, the company has pivoted towards enhancing its “easy, secure, and private” payment experience by collaborating with various credit and debit card issuers, along with Klarna and Affirm competitor, Affirm.

Ending Apple Pay Later

Discontinuation of Program

Apple Pay Later program has been accessible since its complete release to all U.S. customers in March 2023. By June 2024, Apple announced the Apple Pay Later service’s shutdown, reassuring users about alternative payment options that leverage credit and debit cards and established lenders in the checkout process.

Short Period of Availability

Apple Pay Later service operated for a brief period, initially tested with “randomly selected” users in March 2023. After originally announcing the program during WWDC 2022, Apple focused on developing a financial service overseen by its entity, Apple Financing LLC. However, the service couldn’t maintain its presence in the highly competitive BNPL market.

Reasons for Discontinuation

BNPL services have been subject to criticism concerning hidden costs and debt traps. As a result, Apple’s image as a friendly and reputable technology company may have been a contributing factor to its departure from this sector.

Relying on Established Competitors

Apple Pay Later operated in a market with established competitors such as Affirm, PayPal’s Pay in 4, and Klarna. Apple could have faced difficulties in competing with these established brands, leading to the decision to shift focus away from Apple Pay Later.

Lack of Interest

Customer interest in Apple Pay Later could have impacted the company’s decision to discontinue the program. With alternatives such as cards, PayPal, and other BNPL services, users may not have seen enough incentive to use Apple’s BNPL system regularly. As a result, maintaining the service could have been unjustified.

Impact on Customers

For users who have utilized or applied for Apple Pay Later, no financial implications will arise. Apple reassures customers that using alternative payment options, ranging from credit and debit cards to Affirm, will be available immediately.

No Fees or Interest

While operating, Apple Pay Later did not charge any late, annual, or interest fees, and the discontinuation will not affect these outstanding loans. Users can make the entire payment or continue with their scheduled installment plan.

Alternative Options Available

Apple Pay still offers multiple payment options, including Apple Card and major credit and debit cards, and has expanded its network to include Affirm as well. Users can seamlessly transition to these payment methods when checking out with Apple Pay.