Affirm, a startup that offers instant loans for online purchases, is expanding its financing services to brick-and-mortar retail. Shoppers can use Affirm InStore in physical locations, secure credit approval and pay for their purchase in fixed monthly installments.
Additionally, the company revealed that consumers can instantly add a newly issued Affirm virtual card to Apple Pay, via the Affirm mobile app. The platform gives merchants two options to support the service: they can integrate the Affirm InStore API with their POS system or use the expanded virtual card experience.
The in-store integration method is virtually identical to the online and mobile product experience, according to a company statement. To apply, shoppers complete a five-field application for a real-time credit decision. Once approved, the consumer enters the amount they wish to spend and selects a payment plan — usually three, six, 12, 18 or 24 months. Affirm pays the merchant in full at the time of settlement and takes on all fraud risk for the purchase.
Affirm highlighted Apple reseller Simply Mac as a successful use case for the service in a press release. Afterswitching from offering a traditional private label credit card to Affirm InStore in its stores, Simply Mac saw average order values (AOV) increase 20%, credit applications per store boost 63% and credit approvals per store boost 34%.
Affirm raised $200 million in Series E funding in December 2017, with Singapore-based sovereign wealth fund GIC leading the way. Khosla Ventures, Lightspeed Venture Partners, Founders Fund, Spark Capital, Caffeinated Capital, Ribbit Capital and others participated in the round.
Affirm’s valuation is estimated to be between $1.5 billion and $2 billion, as first reported by The Wall Street Journal. The company’s continued growth comes at a time when consumers are becoming increasingly wary of accumulating credit card debt, compound interest or late fees, and are often skeptical of traditional store-branded or private label credit cards that offer “too-good-to-be-true” financing options.