PayPal co-founder Max Levchin says he aims to reinvent consumer finance with Affirm, a credit payment service he launched in 2012 that now allows shoppers to split their payments, a service called Affirm Split Pay.
The service, optimized for mobile payment, is aimed in part at younger shoppers and others with small incomes who are less likely to use credit cards and may have lower credit scores. Retailers are paid in full and Affirm takes financial responsibility for the credit lines.
Affirm Split Pay is much like PayPal’s own Bill Me Later service.
PayPal, now owned by eBay, has dominated online and mobile payments, and its Bill Me Later service also offers credit lines and delayed payments to PayPal users. PayPal co-founder Max Levchin’s Affirm payment service has attracted investors and retailers, yet it’s hard to see how disruptive his Affirm payment system really will be.
A lot is riding on Affirm’s supposed ability to determine good credit risk among consumers whom traditional credit payment systems might reject. If that works, and if enough retailers jump on board, Affirm and Affirm Split Pay could give PayPal a run for its money.