The News Radar

Timely links to external news and articles, usually valuation related, with occasional commentary.


Originally posted Wednesday, 8 June 2022
Apple Will Handle the Lending Itself With New Pay Later Service

Apple Inc. will handle the lending itself for a new “buy now, pay later” offering, sidestepping partners as the tech giant pushes deeper into the financial services industry.

A wholly owned subsidiary will oversee credit checks and make decisions on loans for the service, which is called Apple Pay Later. The business -- Apple Financing LLC -- has necessary state lending licenses to offer the feature, though it operates separately from the main Apple corporation, the company said.

The move marks the first time Apple is handling key financial tasks like loans, risk management and credit assessments. It’s a significant shift for a company that got its start selling computers. Until now, Apple’s financial services have been backed by third-party credit processors and banks. The Apple Card credit card, for instance, relies on Goldman Sachs Group Inc. for lending and credit assessment.

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The company is also working on a longer-term “buy now, pay later” program called Apple Pay Monthly Installments, Bloomberg has reported.

Hugely dissapointing to see this. Buy now, pay later (BNPL) is an aggressivly harmful practice encouraging consumers to spend more than they can afford. For years Apple has been under pressure to raise recurring services cash flows - bummer to see them continue leaning into these predatory practices, otherwise unbecoming of their strong brand.