Apple said its Treasury Department will decide the exact mechanism it will use to fund the loans and that the sources of the funds may change over time.
Apple said its Treasury Department will decide the exact mechanism it will use to fund the loans and that the sources of the funds may change over time.
Apple Inc. plans to remove a loan for its upcoming Apple Pay Later service from its corporate balance sheet, the company said on Wednesday.
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Apple said its Treasury Department will decide the exact mechanism it will use to fund the loans and that the sources of the funds may change over time. Debt and creditworthiness decisions will be handled by Apple Financing LLC, a wholly owned subsidiary.
Apple this week announced a pay-later service, offering to split purchases into four equal payments over six weeks. The service will launch with Apple’s latest operating system for the iPhone and iPad later this year and will put it in competition with existing buy-now, pay-later firms such as Affirm Holdings Inc. and Block Inc.’s Afterpay.
Apple’s post-pay loans will have zero interest and no fees of any kind. To judge creditworthiness, Apple said it plans to use customer credit and other data, such as customer purchases and payment history, in both its stores and online services such as the App Store.
To use the pay-later service, Apple customers need to link a debit card to their Apple Pay account to repay loans. A quarter of the purchase price for approved loans will be payable at the time of purchase, and like other debit card transactions, Apple will check promptly to make sure there is enough money to cover the upfront payment.
Apple will offer the Anywhere loan if Apple Pay is accepted in both online and physical retail stores. Payments to merchants will be made on the MasterCard network through payment credentials issued by Goldman Sachs Group Inc., Apple said.
Apple Financing LLC has lending licenses in all US states where such pay-later services are permitted.