- Affirm launched its service in UK, marks first expansion oversea.
- Affirm expansion in UK reinforcing its mission to transform consumer finance.
What happened
Affrim launched installment loans in the United Kingdom on Monday, marking the company’s first international growth. Affirm, an American fintech startup, was founded in 2012 and provides flexible pay-over-time payment solutions. The organization claims it underwrites each individual transaction before making a lending decision and does not charge late fees.
Affirm, which is regulated by the Financial Conduct Authority, announced that its U.K. offering will include both interest-free and interest-bearing monthly payment alternatives. Interest on its plans will be fixed and computed on the original principal amount, so it will not increase or compound. The move to the United Kingdom represents the company’s first foray into a market other than the United States and Canada. Affirm has over 50 million users worldwide and more than 300,000 active merchants, including Amazon.
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Why it’s important
Affirm‘s launch in the UK marks a significant expansion for the U.S.-based buy now, pay later (BNPL) giant, reinforcing its mission to transform consumer finance. By entering this new market, Affirm strategically taps into the UK’s burgeoning BNPL sector, a space already primed by local players like Klarna and Clearpay. The UK’s BNPL industry has witnessed remarkable growth, driven by increasing demand for flexible payment options, particularly among younger consumers.
Affirm’s entry introduces more competitive pressure on existing companies, potentially driving down fees and promoting better terms for consumers. With its transparent fee structure and no-late-fees model, Affirm distinguishes itself from many traditional lenders and some BNPL counterparts. This approach aligns with the UK government’s push to regulate the BNPL sector, aiming to protect consumers from potential debt traps and unexpected fees. Affirm’s customer-centric policies may set a new standard for the UK market and encourage regulatory compliance across the industry.
