Apple Is Discontinuing Its ‘Apple Pay Later’ Less Than a Year After It Launched

Just a little over half a year since it was fully released to all U.S. customers, Apple is shutting down its installment loan Apple Pay Later service. In a statement to 9to5Mac, the company said customers will now instead see installment loans “offered through credit and debit cards, as well as lenders” when checking out.

Apple Pay Later first started making its way to “randomly selected” customers in the U.S in March 2023 after being announced at WWDC a year prior. The feature existed directly in Apple Wallet, and though Apple said it allowed users to apply for a loan “with no impact to their credit,” fine print said loan and payment history “may be reported to credit bureaus and impact their credit” upon purchase.

The service followed the Apple Card’s launch in 2019, which included an arrangement with Goldman Sachs that Apple is apparently eager to get out of. Apple Pay Later was the company’s first attempt at handling its financial services itself via the Apple Financing LLC subsidiary, and followed in the wake of similar services like Klarna.

Buy now, pay later services have been called out in the past for hidden costs that might trap needy users into even more debt, which might have influenced Apple, with its generally friendly face, in exiting the sector.

“Our focus continues to be on providing our users with access to easy, secure and private payment options with Apple Pay, and this solution will enable us to bring flexible payments to more users, in more places across the globe,” Apple’s statement reads.

In addition to accessing loans from credit and debit cards, Apple Pay will also now allow access to loans from Klarna competitor Affirm, a recent Apple blog reads. Like Klarna, Affirm has also faced criticism in the past, with critics pointing out how high interest rates can lay in wait behind the service’s hip branding.