Following the news that Apple will launch its own Buy Now Pay Later (BNPL) service in the US in September 2022 with the release of iOS 16;

Chris Dinga, Payments Analyst at GlobalData, a leading data and analytics company, offers his view:

“Though Apple is entering a saturated sector which is gradually attracting the attention from regulators, Apple already has loyal customers so it will be able to directly promote its service to consumers who are already used to using its products and Apple Pay.

“According to GlobalData’s Ecommerce Analytics, Apple Pay was the leading digital wallet in the US for ecommerce transactions, putting it ahead of Google Pay, Samsung Pay and even Klarna. By integrating Apple Pay Later into the Apple Wallet, it will make it easy for US consumers to adopt Apple Pay Later. Making it a payment option available at checkout when using Apple Pay will also give it an advantage over other BNPL providers, as competitors are not likely to be integrated within the Apple Pay system.

“Additionally, unlike its BNPL competitors such as Klarna and Affirm, Apple has enough cash reserves to finance the project over time whereas its competitors are raising questions about their ability to turn a profit once regulations are introduced. Companies like Apple and PayPal have enough cash reserve that they could adjust their BNPL revenue model and make it profitable if they need to due to new regulations.”

Listen to Chris Dinga speak about BNPL in GlobalData’s Instant Insights Podcast. The podcast is available on Youtube or Spotify.