Friday, Jun 10, 2022, 14:40 Economy

Details & Background Of New "Apple Pay Later" Feature – A Bigger Step Than You Might Think

Word came out as early as a few weeks ago that Apple intends to expand its activity in the financial sector. With Apple Pay, Apple Cash, and the Apple Card, the company has developed itself into a powerful financial service provider – although still not a bank. Apple Pay is more of a transfer service, and the Apple Card originates from the financial conglomerate Goldman Sachs. However, Cupertino's first step towards an Apple Bank has just occurred with the new service "Apple Pay Later", which enables users to pay for purchases in 4 installments over a 6-week time period. In itself, this is nothing new – however, the manner in which Apple's newest offer's internal processes function is noteworthy for sure.

Apple Pay Later: Not Processed Via 3rd Party
Bloomberg reports that payment is processed via an Apple subsidiary which is also responsible for credit decisions. This company has all of the relevant licenses necessary to function as a bank in a restricted sense with limited business operations. Thus far, Apple has always relied on 3rd parties to determine credit eligibility. Payment installment has already been possible with the Apple Card for quite some time now. There are no other changes to Apple Pay or the Apple Card (which is still dependent upon Goldman Sachs or Mastercard/Visa respectively) with the introduction of this new feature. There shouldn't be any changes in this regard within the foreseeable future either, according to Bloomberg. However, Apple Pay is part of Cupertino's "Project Breakout" which covers the establishment of a true Apple Bank.

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Apple Earns Money Without Interest
There is no interest for users of Apple Pay Later, however, Apple still profits from providing the service if the offer is claimed. Apple takes a small fee from all transactions made via Apple Pay and the intention of Apple Pay Later is to increase the number of transactions subject to this fee, thus increasing the company's revenue as a whole from the Apple Pay service. As of right now, the new service is only available in the USA and there are still no concrete indications concerning an international release date. The new feature can be used directly via the Apple Wallet where all of the current payment plans and upcoming payments are listed.

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