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But providers such as Apple and PayPal have integrated buy now, pay later (BNPL) options into their digital wallets, which help customers pay for installments鈥攚ithout credit card fees. BNPL options can boost conversions and average order values. But digital wallets aren鈥檛 for everyone.

Spotlight on the Affirm Card: The buy now, pay later (BNPL) company鈥檚 debit product helped propel growth. The Affirm Card volume hit $397 million in Q2, up from just $11 million a year ago. And 30% of card volume was in store. The card also boasted 700,000 active consumers at the end of Q2, compared with just 50,000 last year.

The added BNPL options help keep Google on a level playing field with Apple, which also offers Affirm and Klarna as payment options. With virtual cards, Google has a leg up on the competition. Apple recently enabled virtual cards for Apple Cash, but it still doesn鈥檛 offer this security feature for other cards stored in its wallet.

Google is expanding Google Pay's payment options by adding Afterpay to its existing buy now, pay later partners Affirm and Zip, with Klarna coming soon. Our take: Google is one of several notable companies turning to retail and ecommerce to boost engagement and deepen consumer connections.

The news: Buy now, pay later (BNPL) provider Affirm鈥檚 Adaptive Checkout will now be available to all Worldpay from FIS merchants, per a press release. Worldpay merchants will be able to offer consumers biweekly and monthly payment options. Affirm鈥檚 financial state: Affirm has had trouble keeping up with the rapid growth from fiscal 2022.

Buy now, pay later drove $686.3 million in online spend, up 8.8% YoY, per Adobe. GenAI-powered chatbots drove shoppers to spend. Consumers鈥� use of genAI-powered features grew 6% week over week on Black Friday as shoppers turned to the technology to find products that suited their needs, per Adobe.

What this means: Affirm is giving up a major BNPL market鈥攂ut it鈥檒l also minimize costs and improve profitability. Australia had about 7 million BNPL customer accounts as of June 2022, according to the Reserve Bank of Australia. And BNPL payment value had reached $16 billion, about 2% of card purchases that year鈥攎aking it an attractive market for providers.

It will also roll out Pix Garantido, which would let customers make installment payments. There is no launch date for this feature yet. Our take: Pix Proximity can help boost in-store Pix payments by streamlining the payment process at the point-of-sale. These innovations can also help serve as a roadmap for the US as it tries to build a domestic instant payments system, FedNow.

Proximity mobile payments are on a growth tear, driven by strong spend per user. Here鈥檚 how providers are using wallet integration and new features to make proximity payments stickier.

The CFPB has been very active the past year, releasing rules on buy now, pay later (BNPL), open banking, and early wage access programs, among other areas. Of course, the future of the CFPB isn鈥檛 entirely based on the presidential election. Director appointees would need approval from Congress, for example. Cordray鈥檚 own confirmation was held up by Republicans in the Senate for nearly two years.

Neobanks, buy now, pay later providers, and incumbent banks should model on Intuit鈥檚 tool if it proves successful. Part of that success will depend on how Intuit addresses consumer data privacy concerns. Consumer and merchant adoption of genAI-powered chatbots will open new revenue doors for payment providers.

The buy now, pay later (BNPL) craze is creeping into B2B payments. While nascent relative to the consumer-facing market, there鈥檚 significant demand in B2B for alternative financing, especially among SMBs. Payment providers are taking note: Affirm just partnered with Amazon Business, while fintech Capchase launched a BNPL product for long-term business contracts. FedNow is a looming disruptor.

And PayPal鈥檚 enhanced one-time checkout increased buy now, pay later (BNPL) use by 15% to 20%. Making Venmo profitable. One tool PayPal is using is the Venmo Debit Card. In Q3, monthly active debit card accounts grew 30% YoY. But that鈥檚 just 5% of active Venmo accounts, showing room for growth. We forecast US Venmo users will total 76.4 million in 2025.

BNPL is a threat to market share鈥攂ut an overblown one. Like private label credit cards, BNPL gives consumers quick access to credit. Most BNPL providers don鈥檛 conduct a hard credit check, making it an alternative for consumers with lower or no credit scores. BNPL use is quickly growing, especially among lower-income consumers.

Shoppers will lean on BNPL. Globally, BNPL volumes jumped up 237% YoY in the first half of 2024, per ACI Worldwide. ACI expects this bump to carry into the holiday shopping season: Many consumers want flexible payment options to ease their financial concerns. But consumers may be stretching themselves thin.

BNPL will mature as providers target Gen Z with shopping app features. BNPL is thriving as adoption grows across generations. Gen Zers are the most frequent BNPL users, but adoption is accelerating across age groups as high interest rates make borrowing on credit cards expensive.

In addition to BNPL fintechs rolling out BNPL-integrated debit cards like the Affirm card, other payment players are also getting in on the action. Chase offers Chase Pay in 4 to its debit card holders. Unlike its credit card-linked Pay Over Time, Pay in 4 charges no fees to turn a transaction into installments. Suffolk Credit Union has a BNPL product for its debit cards.

Affiliate deals linked to loyalty programs, credit cards, and buy now, pay later (BNPL) services not only help to drive higher conversions, but also help marketers from over-discounting to consumers that would be willing to buy at a higher price, Willens said. Watch the full webinar. This was originally featured in the 蘑菇AV Daily newsletter.

The CFPB鈥檚 yearslong investigation found that Goldman and Apple mishandled consumer disputes and misled cardholders about refunds and Apple product payment plans. Goldman will have to pay $19.8 million in refunds to customers, on top of a $45 million penalty. Apple will have to pay a $25 million fine.

And BNPL is becoming a popular financing alternative: 4 in 10 US digital buyers will use BNPL at least once in 2025, per our forecasts. The Upgrade Financing feature should also prove popular among Apple fans who continually want the latest and greatest Apple products. Apple offers a similar upgrade program for the iPhone.