Apple to enter buy-now-pay-later market

While specialist providers such as Klarna, Clearpay and PayPal have traditionally been at the forefront, Apple has recently announced plans to enter the BNPL market with Apple Pay Later – a BNPL product that will be integrated into the Apple Wallet and eligible to use on purchases made through Apple Pay.  Initially, Apple Pay Later will launch in the USA later this year, with details of any wider international rollout yet to be confirmed.

Given the growth and popularity of BNPL offerings among UK consumers and retailers (the BBC estimated that in December 2021 up to 15 million adults in the UK were active users of BNPL) and the prevalence of Apple Pay users on this side of the Atlantic, at face value the domestic UK market appears well-suited for Apple Pay Later expansion.

However, BNPL offerings have the focal attention of the UK regulators (as summarised in our ongoing series of BNPL articles) and it will be interesting to see how the emerging UK regulatory framework for BNPL impacts on Apple’s (and other BNPL providers’) domestic plans and operations.

Assuming Apple Pay Later does launch in the UK, retailers and payment service providers whom already integrate Apple Pay into their payment propositions and platforms will no doubt welcome an additional BNPL option, particularly if the emerging UK regulatory framework satisfies its objective by striking the right balance between safeguarding consumers while avoiding prohibitive and disproportionate regulation.

TLT’s specialist Payments team is well placed to advise on the contractual mechanics of payment integrations as well as the legal and regulatory implications, and risks, for both retailers and payment service providers, including those offering BNPL services.   Please get in touch if you require any advice on this topic. 

Contributor: Edward Jeffery