The rise of buy now, pay later: affirm expands reach through JPMorgan deal
Pranjal Chandra | Mar 25, 2025, 22:42 IST
The rise of buy now, pay later: affirm expands reach through JPMorgan deal
( Image credit : Agencies )
Highlight of the story: Fintech lender Affirm partners with JPMorgan Chase to offer buy now, pay later (BNPL) installment loans at checkout for merchants on JPMorgan’s payment network. This collaboration highlights the growing consumer demand for flexible financing options and signifies a competitive shift in the BNPL industry, with Affirm and Klarna expanding their U.S. market presence.
In a significant move for the rapidly growing buy now, pay later (BNPL) industry, fintech lender Affirm has announced a new partnership with JPMorgan Chase, enabling merchants on the bank’s payment network to offer installment loans at checkout. This collaboration signals a broader shift in consumer payment preferences, as more shoppers seek flexible financing options for their purchases.
Under the agreement, U.S. merchants that process payments through JPMorgan will soon be able to integrate Affirm’s BNPL services directly into their checkout process. Shoppers will have access to a range of financing options, from short-term loans spanning 30 days to extended payment plans stretching up to 60 months.
Affirm’s partnership with JPMorgan comes on the heels of a similar announcement from Klarna, a Swedish fintech firm that recently revealed its own integration with JPMorgan’s merchant network. As BNPL services gain mainstream traction, competition between major players like Affirm and Klarna is intensifying. Affirm, a publicly traded company focused on sustainable profitability, is expanding its presence in the U.S. market, while Klarna, which recently filed for a U.S. initial public offering (IPO), is aggressively growing its footprint.
Michael Lozanoff, global head of merchant services at J.P. Morgan Payments, emphasized the significance of the deal. “The demand for diverse payment options, flexibility, and seamless transactions from both merchants and their customers is at an all-time high,” he said. “By incorporating Affirm as a payment method into our Commerce Platform, we are empowering businesses to deliver the services they need and the experiences that customers increasingly expect as part of their retail journey.”
The BNPL model has revolutionized how consumers approach spending, offering an alternative to traditional credit cards. These services provide installment-based financing without the high-interest rates associated with revolving credit, making them especially attractive to younger consumers who may be wary of traditional debt. Affirm’s deal with JPMorgan reinforces the increasing adoption of BNPL solutions as standard payment options in retail and e-commerce.
Affirm’s CEO, Max Levchin, has long championed responsible lending, positioning the company as a transparent and consumer-friendly alternative to credit cards. Unlike many credit card companies, Affirm does not charge late fees or compound interest, which has helped the platform gain trust among shoppers seeking a more predictable repayment structure.
For merchants, integrating Affirm’s BNPL service could lead to increased sales and higher average order values. Studies have shown that consumers are more likely to complete purchases when offered flexible financing options, reducing cart abandonment rates and boosting conversion rates.
For consumers, having Affirm available at checkout provides greater financial flexibility. With the economic landscape still uncertain, BNPL services allow shoppers to manage their budgets more effectively while still making essential and discretionary purchases.
The collaboration between Affirm and JPMorgan highlights a broader trend of traditional banks partnering with fintech firms to offer innovative financial solutions. As the BNPL sector continues to grow, such partnerships could become more common, further blurring the lines between traditional banking and fintech.
While the exact rollout timeline for Affirm’s integration with JPMorgan’s merchants remains unclear, the partnership marks a significant step in Affirm’s expansion strategy. As BNPL becomes an increasingly standard payment option, both merchants and consumers stand to benefit from the added financial flexibility it provides.
Under the agreement, U.S. merchants that process payments through JPMorgan will soon be able to integrate Affirm’s BNPL services directly into their checkout process. Shoppers will have access to a range of financing options, from short-term loans spanning 30 days to extended payment plans stretching up to 60 months.
Intensifying competition in the BNPL space
Michael Lozanoff, global head of merchant services at J.P. Morgan Payments, emphasized the significance of the deal. “The demand for diverse payment options, flexibility, and seamless transactions from both merchants and their customers is at an all-time high,” he said. “By incorporating Affirm as a payment method into our Commerce Platform, we are empowering businesses to deliver the services they need and the experiences that customers increasingly expect as part of their retail journey.”
A changing consumer finance landscape
Affirm’s CEO, Max Levchin, has long championed responsible lending, positioning the company as a transparent and consumer-friendly alternative to credit cards. Unlike many credit card companies, Affirm does not charge late fees or compound interest, which has helped the platform gain trust among shoppers seeking a more predictable repayment structure.
Implications for merchants and consumers
For consumers, having Affirm available at checkout provides greater financial flexibility. With the economic landscape still uncertain, BNPL services allow shoppers to manage their budgets more effectively while still making essential and discretionary purchases.
The future of BNPL and banking partnerships
While the exact rollout timeline for Affirm’s integration with JPMorgan’s merchants remains unclear, the partnership marks a significant step in Affirm’s expansion strategy. As BNPL becomes an increasingly standard payment option, both merchants and consumers stand to benefit from the added financial flexibility it provides.