Stocks at Affirm dropped after a report that Apple is working with Goldman Sachs to introduce a competing “buy now pay later” product was released.
Affirm’s shares fell by over 10 percent on Tuesday, 14 July 2021, after a report on Apple’s plans to offer a competing “buy now pay later” product in partnership with Goldman Sachs. Affirm is a company that offers borrowing services for retailers. The company reportedly offers instalment payments for products.
Before the report, Affirm’s stock was reportedly slightly up, but after the announcement, the stock crashed immediately, falling by over 10 percent in about 30 minutes. Affirm reportedly closed out the day at $58.21 per share, down by 10.45 percent from its 52-week high of $146.90 per share. Affirm has an implied market capitalisation that is reported to be approximately $15.43 billion.
The report is supposedly a sign that Apple wants to venture into offering additional financial services, and also secure partnerships with financial services firms. The “buy now pay later” products will reportedly allow customers to buy a pricey product and pay it off over several months. Goldman Sachs will act as the lender for the instalment products.
Furthermore, this financial venture will reportedly join Apple’s most notable financial products, such as Apple Card, which is a credit card accessed through the iPhone and administered by Goldman Sachs. This is reportedly not the first “buy now pay later” product of its kind at Apple. According to reports, the company has previously offered monthly instalment payments with no interest on some of its products bought through the Apple Store, with an Apple Card. Apple Card holders can also reportedly buy an iPhone in 24 monthly instalments, with payments being bundled into the minimum credit card payment inside the wallet app.
Lastly, Goldman Sachs stock reportedly finished out Tuesday’s session lower, while stocks at Apple jumped to $145 per share. No date has been given yet regarding the potential rollout of the product.