Affirm Teams with Worldpay, New York Life to Boost BNPL Against Klarna, PayPal
Affirm has made a strategic decision to enhance its presence in the competitive buy now, pay later (BNPL) market. The company has partnered with Worldpay and expanded its collaboration with New York Life to strengthen its installment lending capabilities.
Partnership with Worldpay
The partnership with Worldpay is a significant development for Affirm. This collaboration will integrate Affirm’s offerings into Worldpay’s embedded payments platform. This move provides Affirm access to over 1,000 software-as-a-service (SaaS) companies.
- Worldpay’s SaaS companies processed more than $400 billion in payments last year.
- Affirm’s financing options will be available at a starting rate of 0% annual percentage rate.
- Purchases range from $35 to $30,000, with repayment terms from 30 days to 60 months.
Wayne Pommen, Chief Revenue Officer at Affirm, emphasized the importance of being where consumers prefer to make payments. He stated, “Our strategy has always been to have our methods available in as many places as possible.” This strategy aligns with the trend towards embedded payments, crucial for businesses like gyms and medical offices seeking seamless payment solutions.
Expansion with New York Life
Affirm’s collaboration with New York Life involves a commitment to purchase up to $750 million of Affirm’s installment loans through December 2026. This agreement is expected to provide off-balance-sheet funding to facilitate approximately $1.75 billion in consumer loan volume annually.
New York Life’s past investments in Affirm, totaling nearly $2 billion, reflect their confidence in the company’s credit performance. Brendan Feeney from New York Life remarked, “Affirm has distinguished itself by delivering superior credit outcomes that generate attractive returns.”
Competitive Landscape in BNPL
With rivals such as PayPal and Klarna expanding their offerings, the BNPL landscape is becoming increasingly competitive. PayPal recently forged a partnership with Blue Owl Capital to enhance its BNPL portfolio, processing over $33 billion in payment volume in 2024—a 21% increase from the previous year.
As Affirm seeks to solidify its position in the market, analysts view the BNPL sector as a mix of growth opportunities and challenges. Concerns regarding credit performance and private credit funding health have emerged. However, Affirm’s strategic collaborations and innovative solutions may help it navigate this landscape.
As Affirm approaches its earnings call, the results of these new partnerships will be closely monitored by analysts and investors, highlighting their importance in the evolving competitive field of BNPL.
