Core Insights - The rise of rent now, pay later services indicates the increasing unmanageability of housing costs for many Americans [4][9] - Affirm has launched a pilot program allowing renters to split their payments into two installments, partnering with Esusu for credit score reporting [2][5] - Monthly service fees and potential finance charges can make these services more expensive than traditional payment methods [6][9] Company-Specific Insights - Affirm's new service does not charge interest but involves monthly fees, accessible only through Esusu's Plus and Premium services [3][5] - Other companies like Zip and Livble offer similar services, with Zip advertising an annual interest rate of 31.11% and Livble charging monthly finance charges of $30 to $40 [6][7] - Flex provides a rent-splitting option that may require landlord participation, with a monthly fee of $14.99 and additional charges [7] Industry Trends - The growth of rent now, pay later services reflects broader economic challenges, as turning rent into installment debt can increase household debt and reduce overall consumer spending [4] - Many of these services are reported to be more costly than using credit cards for rent payments, highlighting the financial strain on renters [6][9]

Affirm’s fiscal second quarter illustrated how buy now, pay later is becoming embedded in routine commerce, where paying over time was once reserved for occasional large purchases.By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions .Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional lo ...

Affirm (NasdaqGS:AFRM) Q2 2026 Earnings call February 05, 2026 05:00 PM ET Company ParticipantsAdam Frisch - Senior Managing DirectorBryan Keane - Head of North America Payments Processors & IT Services ResearchDan Perlin - Managing DirectorDarrin Peller - Managing DirectorJohn Hecht - Managing DirectorMatt Coad - Equity Research DirectorMax Levchin - Founder and CEOMichael Linford - COONate Svensson - Director in Equity ResearchRayna Kumar - Managing Director and Head of Fintech Equity ResearchReginald Smi ...

Affirm (NasdaqGS:AFRM) Q2 2026 Earnings call February 05, 2026 05:00 PM ET Speaker2Good afternoon. Welcome to the Affirm Holdings second quarter fiscal 2026 earnings call. Following the speaker's remarks, we will open the lines for your questions. As a reminder, this conference call is being recorded, and a replay of the call will be available on our investor relations website for a reasonable period of time after the call. I'd now like to turn the call over to Zane Keller, Head of Investor Relations. You m ...

Core Insights - Klarna's "Pay in 4" option allows users to split purchases into four equal, interest-free payments, appealing to consumers who prefer to manage cash flow while keeping funds in high-yield savings accounts [1][2] - The convenience of Buy Now, Pay Later (BNPL) services can obscure potential risks, particularly for users who may miss payments despite having the financial means to pay [2][3] Group 1: User Behavior and Motivations - A survey indicated that 34% of BNPL users chose services like Klarna primarily for the ability to pay over time without interest, even if they could afford the purchase outright [2] - Convenience and ease of approval are significant factors driving the adoption of BNPL services [2] Group 2: Payment Risks and Structural Issues - BNPL services are designed to be frictionless, which can lead to missed payments; 42% of BNPL users reported at least one late payment in the past year due to various reasons [3] - Unlike traditional credit card bills, BNPL payments are distributed across multiple retailers, increasing the risk of delinquency from issues like failed debits or expired cards [4] - Klarna warns that missed payments may lead to late fees and collections, and these services may report delinquent accounts to credit bureaus [4][5]

There is a lot of noise in the market right now regarding the Buy Now, Pay Later, or BNPL, industry. If you scroll through investor forums or analyst notes, you’ll see it’s a deeply polarizing topic. Many critics look atI write about stocks I’m personally interested in adding to my portfolio. I’m not a professional advisor, but I study business and economics and analyze markets full-time. My writing is meant for both complete beginners — I avoid unnecessary complexity — and advanced readers, as I always aim ...

Core Insights - Fiserv has partnered with Affirm to integrate buy now, pay later (BNPL) capabilities into its debit card programs, responding to consumer demand for flexible payment options [2][4] - The collaboration aims to enhance customer engagement and transaction growth by allowing issuers to embed BNPL into existing debit products [5] Group 1: Partnership Details - The partnership is designed to provide community and regional banks and credit unions with the ability to meet evolving consumer expectations for payment flexibility [3] - Affirm and Fiserv will handle all technical aspects of the integration, combining Affirm's real-time underwriting and loan origination capabilities with Fiserv's digital solutions [4] Group 2: Market Context - The announcement follows Affirm's plans to establish a bank subsidiary, Affirm Bank, which aims to diversify its platform and offer more financial products [6] - Consumers who are likely to use BNPL have average credit card balances that are $1,128 higher than those who are unlikely to use it, indicating a significant financial behavior trend [7] Group 3: Consumer Behavior Insights - Habitual BNPL users hold average credit card balances of $5,181, which is approximately 60% higher than non-users, reflecting a shift in how households manage short-term credit [7][8] - The trend of using BNPL is seen as a strategy for managing timing mismatches between income and expenses rather than reckless spending [8]

Core Viewpoint - A class action lawsuit has been filed against Klarna Group plc, alleging that the company materially understated risks related to its loss reserves in its IPO registration statement, impacting investors who purchased securities during the specified class period [1][3]. Group 1: Lawsuit Details - The lawsuit is on behalf of investors who acquired Klarna securities from September 7, 2025, to December 22, 2025, including shares from the September 2025 IPO [1][2]. - Investors have until February 20, 2026, to seek appointment as lead plaintiff representatives of the class [2]. Group 2: Company Performance - Klarna's share price has declined from the IPO price of $40 per share to approximately $31.31 per share at the time of the lawsuit filing [3]. Group 3: Company Background - Klarna is a leading global fintech company based in Stockholm, Sweden, specializing in Buy Now, Pay Later (BNPL) solutions [2].

Core Insights - Affirm Holdings, Inc. (AFRM) has upgraded its credit risk evaluation by incorporating real-time financial signals into its underwriting process, enhancing the accuracy of credit assessments [1][9] - The new method is currently available for Affirm Card users and will soon be accessible to a broader audience who opt to link their banking data [2] - This approach allows Affirm to assess creditworthiness based on current financial health rather than outdated credit histories, potentially increasing consumer purchasing power [4] Group 1: Affirm's New Underwriting Process - Affirm's upgraded underwriting now includes real-time bank account balances and cash flow trends, moving away from static credit reports [1][9] - The new system aligns credit decisions with real-life financial situations, improving risk assessment and promoting responsible lending [3] - Early results indicate that this richer view of consumer finances can significantly enhance purchasing power [4] Group 2: Market Position and Performance - The upgrade is expected to improve Affirm's credit quality by reducing default risk and expanding its consumer base, leading to increased approvals and revenue growth [5] - Affirm's Gross Merchandise Value rose 42% year over year in Q1 of fiscal 2026, reaching $10.8 billion [5] - Affirm's shares have increased by 25.2% over the past year, outperforming the broader industry and the S&P 500 Index [7] Group 3: Competitive Landscape - Competitors like PayPal and Block, Inc. are also expanding their BNPL services, with PayPal's total payment volume increasing by 8% to $458.1 billion and Block's BNPL gross merchandise volume climbing 17% to $9.7 billion [6] - The competition in the digital consumer lending space is intensifying, highlighting the need for innovative approaches like Affirm's [6] Group 4: Valuation and Earnings Estimates - Affirm's forward price-to-earnings ratio stands at 55.42X, significantly higher than the industry average of 31.72X, indicating a premium valuation [11] - The Zacks Consensus Estimate predicts a 560% surge in Affirm's fiscal 2026 earnings year over year, followed by a 56.8% increase in the subsequent year [11]

Core Insights - Klarna made its stock market debut in September 2025, but its shares have decreased by approximately 24% since the IPO, contrasting with a 7% increase in the S&P 500 index [1][2] Business Model - Klarna's primary service is the "Buy Now, Pay Later" (BNPL) model, particularly its "Pay in 4" option, which allows consumers to make four interest-free payments if the total amount is repaid within about six weeks [3] - The company also offers longer-term financing options, termed Fair Financing, which are closed-end loans with terms ranging from six to 24 months and are designed for higher-cost goods and services [4] Financial Performance - Klarna achieved a record quarterly revenue of $903 million in Q3 2025, reflecting a 28% year-over-year increase [5] - The gross merchandise value (GMV) in the U.S. surged by 43%, contributing to an overall GMV of $32.7 billion [6] - The total number of merchants using Klarna's services increased by 38% to around 850,000, alongside a 32% rise in active customers [6] Strategic Direction - Klarna is positioning itself as a "digital bank," indicating a shift in focus beyond just BNPL services to broader financial offerings [9] - The company plans to launch its own stablecoin, KlarnaUSD, which aims to reduce costs and potentially enhance profitability if managed effectively [10]