Buy-now-pay-later (BNPL) service providers brace for impact as Apple Inc. launches its long-awaited BNPL service Apple Pay Later.

More than half (53.9%) of Digital Commerce 360’s Top 1000 retailers currently offer a BNPL option at checkout. 39.8% of Top 1000 retailers already offer Apple Pay. Digital Commerce 360’s Top 1000 database ranks the largest North American online retailers by web sales. Apple ranks No. 3 in the Top 1000.

Consumers can spread the costs of purchases made online with merchants that accept Apple Pay, and for in-app purchases through iPhone and iPads, ranging from $50-$1,000. Payments are broken down into four payments over a six-week period without interest or fees, similar to BNPL service providers Affirm Holdings, Afterpay Ltd., Klarna Bank AB, PayPal Holdings Inc., and others.

Consumers can apply for Apple Pay Later loans of $50-$1,000, for online and in-app purchases made on iPhone and iPad with merchants that accept Apple Pay.

Consumers can access the service using the iPhone Wallet app.

Apple Pay Later funded through new subsidiary Apple Financing LLC

Apple will fund the loans through its new subsidiary: Apple Financing LLC. The tech giant’s subsidiary performs its own credit checks. Mastercard Installments program enables the BNPL service. Merchants that already accept Apple Pay do not need to do anything more to implement the BNPL service for their customers, according to the company.

Merchants that accept Apple Pay offer shoppers the option during online checkout as well as within iPhone and iPad apps, according to Apple.

Goldman Sachs is the issuer of the Mastercard payment credential, which is the stored cardholder’s card data used to make a payment to complete Apple Pay Later purchases.

Who can use it today?

In a released statement, Apple said “randomly selected users will be invited to get early access to a pre-release version of Apple Pay Later via Wallet and through their Apple ID email.”

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