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 ...

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]

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].

Americans are flocking to “buy now, pay later” services this holiday shopping season https://t.co/cbUKohMiEE ...

Core Insights - The discussion highlights the behavioral risks associated with Buy Now, Pay Later (BNPL) services like Klarna and Afterpay, suggesting that while they may seem beneficial, they can lead to overspending and financial strain [1][2][3] Behavioral Risks - Users may feel encouraged to make purchases they wouldn't normally consider due to the perceived increase in purchasing power from splitting payments [2] - The structure of BNPL services can lead to a cycle of overspending, particularly for individuals living paycheck to paycheck [2][3] - A user shared an experience of accumulating $900 in monthly payments through Klarna, illustrating the potential for financial distress [3] Financial Comparison - The financial benefits of using BNPL services are minimal; for example, parking $1,700 in a high-yield savings account may yield only $3 to $5 in interest over six weeks [4] - In contrast, using a credit card with a 2% cashback on a $1,700 purchase would provide $34 in rewards, significantly outweighing the interest earned from a savings account [4] - Credit cards also offer additional benefits such as purchase protection and chargeback options, which are not available with BNPL services [4]

Group 1 - Affirm Holdings, Inc. reported a strong quarterly performance with a 12-cent earnings beat and higher-than-expected revenue, leading to an initial stock price increase of over 11% [1] - Following the impressive quarter, the stock price has declined to around $65, raising concerns about consumer spending despite positive signals from other retailers and recent interest rate cuts by the Federal Reserve [1] - The company provides a digital payment platform that allows consumers to pay for purchases over time, indicating its role in the evolving payment solutions market [2] Group 2 - The CEO of Affirm Holdings, Max Levchin, received commendation for his leadership, with notable support from investment community members [2] - While Affirm Holdings shows potential as an investment, there are suggestions that certain AI stocks may offer greater upside potential with less downside risk [2]

On this episode of Everybody’s Business, we talk about $Trump and the increasing popularity of “buy now, pay later” https://t.co/FhA3ISQnvK ...

Core Insights - Sezzle's in-app financial literacy program, MoneyIQ, has achieved over one million lessons completed by more than 200,000 users in under a year, highlighting its growing popularity as a comprehensive platform for shopping, rewards, and financial education [1][2][8] Group 1: Financial Literacy Program - MoneyIQ is designed to enhance users' long-term financial well-being by integrating financial education into the Sezzle app, allowing users to learn while managing payments and tracking spending [2][5] - The program features bite-sized lessons focused on practical financial skills, developed under the National Standards for Personal Finance Education, and is powered by Zogo [5][6] - Following the launch of MoneyIQ, user confidence in financial management increased significantly, with 51% of users feeling "very confident" about their finances, up from 37% prior to the program [6] Group 2: User Engagement and Incentives - Users earn experience points for completing lessons, which can be redeemed for Sezzle Spend, promoting positive financial habits and responsible behavior [7] - The most commonly completed lessons include essential skills such as opening a bank account, saving money, repaying debt, building a budget, and improving credit [9] Group 3: Market Context and Company Vision - As the Buy Now, Pay Later (BNPL) model becomes more mainstream, Sezzle aims to redefine its role by ensuring that it supports both purchasing power and users' long-term financial confidence [8] - The initiative addresses a significant gap in financial literacy, particularly among Gen Z, where 28% report lacking financial knowledge, which correlates with lower confidence levels in managing finances [4]