[ad_1]
(Bloomberg) – Affirm Holdings Inc. has jumped in post-market trading after partnering with Amazon.com Inc. to help consumers fund large purchases made on the e-commerce giant’s website.
The reconciliation will allow Amazon customers to pay for expenses greater than $ 50 in monthly installments, Affirm said in a statement Friday. Companies have already started testing with selected customers and will make the option more widely available in the coming months.
Shares of Affirm surged to $ 92.50 at 7:21 p.m. in New York City, up 36% from the close of regular trading.
Led by CEO Max Levchin, Affirm is one of the growing multitude of startups helping consumers divide their purchases into smaller installments. The options have exploded in popularity in the United States in recent months, especially among younger consumers. Americans spent up to $ 25 billion using the plans in 2020 alone.
What Bloomberg Intelligence says
“If Affirm captures just 1% of Amazon.com sales in North America through this deal, it could add more than $ 900 million, or 10%, to revenue. The deal comes just in time as Affirm’s biggest customer Peloton, accounting for 20% of revenue, has lowered prices and lowered sales expectations. “
–Julie Chariell, Senior Fintech BI Industry Analyst
Click here to read the research.
Yet for Amazon, the deal gives buyers an additional way to pay later for the things they want now. The retailer is already offering credit card deals to Prime members with cash back or interest-free launch terms through partnerships.
Affirm has promised that it will not charge any late fees, and the company said customers will know the full cost of using its services at checkout.
(Updates with excerpt from analyst commentary.)
More stories like this are available at bloomberg.com
Subscribe now to stay ahead of the game with the most trusted source of business information.
© 2021 Bloomberg LP
[ad_2]
Source link