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Walmart is partnering with digital-first financing player Affirm to offer point-of-sale (POS) financing at checkout in-store at nearly 4,000 Walmart Superstores in the US and on Walmart.com in the coming weeks, following rumors dating back to 2017.
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The partnership will enable Walmart shoppers to choose Affirm at checkout and select a repayment period of 3, 6, or 12 monthly installments for purchases between $150 and $2,000.
This news follows another recent move by Walmart to restructure its payment options: Walmart recently announced the ending of its 19-year issuing partnership with major private-label card issuer Synchrony Financial and selected Capital One as the new issuer for its store cards and cobranded products.
This partnership comes alongside rising consumer awareness in alternative financing and can help propel Affirm to the forefront of the financing space.
- Seventy-eight percent of US consumers were aware of POS financing options as of 2017, up from 51% in 2015. Rising consumer awareness in alternative financing options will likely continue to be instrumental in driving volume and demand for these services going forward. Further, the growing popularity of POS financing programs like Affirm and Klarna can pose threats to traditional store cards as consumers might opt to finance a purchase rather than open a new store card and pay off the balance.
- Partnering with a top three US retailer could ultimately help Affirm emerge as a leader in the financing space amid crowding. Affirm initially expanded from online-only to brick-and-mortar retail in 2018, allowing merchants to integrate its offering through an application programming interface (API), which gives it an advantage over digital-only competitors as the space becomes more crowded with firms like Klarna, Splitit, and Afterpay all entering the US retail market. Further, partnering with Walmart can substantially increase Affirm’s brand visibility to both consumers and other US retailers. Its integration with Walmart can highlight the advantages of POS financing, particularly on influencing customer spending, which could encourage more retailers to adopt Affirm or other financing options: 39% of consumers would spend more money if given instant credit options when shopping online, for example.
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See Also:
- The European Commission is pushing the TIPS real-time payments platform
- Mastercard is reportedly resuming its China pursuit
- A blockchain platform for oil is making waves
SEE ALSO: The Payment Industry Ecosystem: The trend towards digital payments and key players moving markets
Source: Business Insider – feedback@businessinsider.com (Rachel Green)