Affirm and Shopify have expanded their pay-later offering outside the United States.
The mentioned companies announced on Wednesday, April 9, that Canadian merchants who interact with Shopify and sign up for early access can now begin offering the Affirm-powered Shop Pay Installments program. The specified program became available outside the United States for the first time.
Kaz Nejatian, Shopify’s chief operating officer, said the company is thrilled to launch Shop Pay Installments in early access to Canada as its first step beyond the US. Also in this context, it was noted that the firm’s partnership with Affirm expands its global reach, providing shoppers with the flexibility to make payments over time and increasing conversion rates for merchants worldwide.
Moreover, it became known that in the summer of the current year, Shop Pay Installments will be available in general access to Shopify merchants in Canada and the United Kingdom. Cross-border commerce opportunities between the two mentioned countries and the United States are expected to be launched later.
It is worth mentioning that in February, Shopify and Affirm first announced plans to expand Shop Pay Installments. In this case, customers can make payment transactions at customized biweekly or monthly intervals.
After launching in Canada and the UK, the companies intend to expand their partnership to Australia and Western Europe. It is expected that the initial stage of the implementation of the relevant plan will begin in Germany, France, and the Netherlands.
The companies note that as Shop Pay Installments are launched in each new market, local merchants will be able to seamlessly activate the product directly from the Shopify admin dashboard. In this case, there is no need for any additional development or technical integration.
The increased scale of the partnership between Shopify and Affirm is observed at a time when, as the media notes, Buy Now, Pay Later (BNPL) options are rapidly becoming an integral part of how consumers budget, shop, and pay.
Affirm founder and chief executive officer Max Levchin, during a conversation with media representatives, stated that, in his opinion, the sector is being transformed into a trusted, ubiquitous service, much like American Express became a household name in credit. He also believes that consumers prefer the predictability of BNPL and a sense of control over repayment more than the ability to borrow. According to him, the Affirm’s appeal is not related to the fact that it is a very good way to borrow money. He noted that rather, appeal lies in the ability to eliminate late fees and hidden costs, while simultaneously increasing merchant’s conversion rates and average transaction values.
Recently, BNPL has become a popular solution among more affluent consumers for both luxury purchases and essentials. This tendency has different reasons. For example, BNPL can be a profitable choice if a person is faced with the need for expensive car repairs when a credit card is maxed out. Also, sometimes the cards contain rewards and perks that consumers intend to keep for certain purposes. In this case, the BNPL will allow them to stick to the original plan, despite unforeseen significant costs.
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