In a real curveball for Apple fans, it looks like Apple is getting into the ‘Buy Now Pay Later’ (BNPL) market. Apple Pay Later rolled out at the end of March, confusing a lot of investors.
The big question…
Why?
Apple isn’t known for financial lending – it’s known for personal electronics. Then again, financing can help buy phones and personal computers. Mystery solved.
When shoppers use Apple Pay, they can pay for their purchase in four payments spread over six weeks. The feature has a minimum spend of $50 and a generous maximum spend of $1,000.
It’s been a bit of a Wild West in the BNPL world since the pandemic.
Afterpay, a popular BNPL service, was purchased for $30 billion in 2021. Unfortunately, additional competition from competitors like PayPal, Walmart and Uplift has put pressure on Afterpay and others alike. Rising interest rates have also made BNPL an unattractive finance choice. Add a crackdown from regulators on shady lending practices, and it seems like the Golden Age is over for this payment method.
So why did Apple get into this shaky game? To put it simply, they have a near-unlimited money supply. The popularity of the iPhone isn’t going away any time soon, and 85% of retailers currently accept Apple Pay, compared to only 3% back in 2014.
Essentially, they’re trying to corner the market or, at the very least, trying to make Apple Pay more attractive (c’mon, Android users, is it working?).
Sometimes these financial ventures seem like a fool’s game, but for savvy corporations, that’s exactly what it is: a game.
There’s no reward without risk.
Investments are a bit of a long game, too. Like launching a new venture like Apple Pay Later, results don’t come overnight. It takes planning, reassessing, and tweaking to meet the end goal. The biggest thing you can do to improve your retirement investing is to start!
It’s not too late to take control of your finances. Give me a call at 330 836 7800 Ext. 1 or set up a time in my online calendar for your free 15-minute financial review.
